Bank of Baroda cuts MCLRs by 0.15% in all terms; reduces term deposit rates

NEW DELHI: State owned Baroda Bank on Thursday it cut the marginal cost of the fund-based loan rate (MCLR) by 0.15 percent between terms and also cut term deposit rates on selected maturities.

The reduction in MCLRs will reduce interest on consumer loans, including personal, auto, and home.

The one-year MCLR, the benchmark for most consumer loans, has dropped to 8 percent from 8.15 percent, the bank said in a statement.

Among other terms, the MCLRs of overnight loans to six months have been reduced by 0.15 percent each in the range of 7.40 to 7.85 percent.

The bank said the new MCLRs will take effect on April 12, 2020.

It has also reduced interest rates for national time deposits, including NRO, NRE and Non-Callable for deposits below Rs 2 crore with effect from April 9, 2020, he said.

Non-callable term deposits are used to invest surplus funds for an extended period in which premature withdrawals or overdraft facilities, among others, are not allowed.

While an NRE account is a bank account opened in India in the name of an NRI, to park your foreign earnings; while an NRO account is a bank account opened in India in the name of an NRI to manage income earned in India.

General interest has been reduced from 5.90 percent to 5.70 percent over 5-10 years and from 4.25 percent to 3.50 percent for deposits of 7 to 14 days, he added.

Baroda Bank said it will continue to pay an additional interest of 0.50 per cent on domestic term deposits of less than Rs 2 crore for senior citizens for all tenures in terms of extant guidelines.

Senior citizens in India are eligible for additional interest of 1 percent per annum (i.e. 1 percent of normal staff privilege plus 0.50 percent as a benefit for seniors) in New term deposits and renewals of term deposits of existing residents of less than Rs 2 crore for maturities of 15 days to 10 years, the lender said.

Earlier this week, the country's largest lender, SBI, had announced that it would reduce the savings deposit rate and MCLRs by 0.25 percent and 0.35 percent, respectively.