Benchmark Prime Lending Rates (BPLR) has finally been hiked by the major players in banking segment namely State Bank of India and ICICI Bank.
ICICI Bank has raised its BPLR and floating reference rate (FRR) by 50 basis points. FRR applies to consumer loans like home loans.
SBI has also raised its BPLR by 50 basis points taking the figure to 12.25%.
With increasing in the benchmark set for loans, interest rates on loans are also set to rise thereby bringing a rise in the EMI payable by the borrower.
The increase in EMI will depend on the rate charged on the loan and also the tenor which will vary from bank to bank.
BPLR has been raised by several banks like Punjab National Bank, IDBI Bank, Corporation Bank etc.
"Lending rates of the banks are linked to BPLR, which swings in proportion to changes in the latter," said R R Nair, CEO, LIC Housing Finance.