Banks Hike Rates: Is Your EMI Rising This Month?

Several major banks have raised their lending rates, meaning your home loan, car loan, or personal loan EMI may go up. If your loan is on a floating rate, you could be paying more already — here's how to check and what to do.

Here's what happened: Several major Indian banks have revised their lending rates upward, with changes taking effect from early October, directly raising borrowing costs for new and existing floating-rate loan customers.. Banks primarily adjusted their MCLR (Marginal Cost of Funds-based Lending Rate) — the internal benchmark that determines interest on most home, car, and personal loans issued before October 2019.. Some banks kept their Base Rate and MCLR for select tenors unchanged, meaning the impact varies by which bank you borrowed from and which rate tenor your loan is linked to..

What you should do: Check your loan sanction letter or net banking account to find out whether your loan is MCLR-linked, repo-rate-linked (EBLR), or on a fixed rate — this determines if and when your EMI will change.. Call your bank's loan helpline or visit the branch to ask for your next EMI reset date; if a rate hike has already been applied, ask for a revised amortisation schedule in writing.. Compare balance transfer offers from other RBI-licensed banks and NBFCs — even a 0.30% lower rate on a ₹25L loan can save you ₹40,000–₹60,000 over the remaining tenure..

If your home loan is MCLR-linked and older than 2019, ask your bank to switch it to a repo-linked EBLR loan — processing fees are often waived for existing customers and the rate resets faster when RBI cuts rates.