New Delhi, Dec 9: After the price war in telecom, a interest rate war entered the banking sector with ICICI bank introducing a 'Two Year Fixed Rate Scheme' to thwart the competition from Kotak Mahindra Bank.
Under the new scheme, 8.25 per cent interest rate will be fixed for the first two years after the disbursement has been made.
The scheme, which came into effect on Dec 3, 2009, is applicable for all new 'Home Loan Sanctions and Disbursements' and will be offered on sanctions made till January 31, 2010.
Since it is valid till Mar 31, 2010 and the customers have to make sure that the first disbursement of the loan should be availed on or before this date.
After the first two years, the ICICI Floating Reference Rate (FRR) minus 4 per cent, FRR minus 3.5 per cent and FRR minus 3 per cent will be applicable for loan up to Rs 20 lakh, between Rs 20 lakh to Rs 50 lakh and above Rs 50 lakh.
Earlier, Kotak Mahindra Bank announced its new home loan scheme, under which there is a 8.49 per cent fixed rate on home loans for 30 months from the date of the payout of the loan.