State-owned lender Punjab & Sind Bank (PSB) has cut its interest rates for home and auto loans for new borrowers by up to 0.75%.
The announcement coincided with the RBI’s annual credit policy which reduced the benchmark lending rate by 0.5% to 8%. In home loan, interest rates have been reduced between 0.25-0.50% while for auto loan it varies between 0.25-0.75% depending on maturity and amount borrowed.
The bank offered home loan to its customer between 11-12.75% prior to reduction. At the same time, auto loan rate varied between 12.75-13.75%. The new rates have become effective from April 1.
Meanwhile, the RBI reduced the short-term lending (repo) rates to 8% from 8.5%. In the Annual Monetary Policy, 2012-13, RBI doubled borrowings under the Marginal Standing Facility for banks to 2% of their deposits with immediate effect to ease liquidity. It also permitted banks to borrow under the MSF even if they have excess government securities holdings.
