SBI cuts EBR, home loans to get cheaper from Jan

New Delhi, Dec 30
The State Bank of India (SBI) on Monday reduced the external benchmark-based rate (EBR) by 25 basis points to 7.80 per cent from 8.05 per cent, which would be effective from January.

With this, the EMI (equated monthly installment) on existing home, and the MSME (micro, small, and medium enterprises) loans will come down.

The SBI's EBR is finalised at 265bps plus 5.15 per cent repo rate of the Reserve Bank of India (RBI). The bank also charges 10-75bps premium for pricing the effective interest on the home loans.

The RBI's Monetary Policy Committee (MPC) had cut the benchmark lending rate (repo rate) by 25bps to 5.15 per cent in October. However, after five consecutive rate cuts cummulatively amounting to 135 bps, the RBI kept the interest rates unchanged earlier this month.

RBI Governor Shaktikanta Das had said against the 135 bps repo rate cut, the reduction in retail loans had been only 44bps.