GE Money to hike home loan interest rates

New Delhi, Mar 31: Financial services provider GE Money today said it will hike its home loan interest rate from April.

''We plan to hike the home loan interest rate by 50 basis points from April,'' GE Money President, India region, Vishal Pandit told reporters.

The company at present lends home loans at the rate of 7.75 per cent. ''We have disbursed home loans worth Rs 2,000 crore till now,'' Mr Pandit said.

Banks and housing finance companies in India are faced with a liquidity crisis that has compelled them to increase interest rates on home loans.

HDFC recently increased its floating home loan rate by half a percentage point to 8.25 per cent. ICICI Bank also increased its rates twice by half a percentage point each in the last one month to 8.75 per cent.

Other banks like SBI, PNB and LIC Housing Finance have also hiked the rate.

Experts say if the liquidity condition does not improve, banks and finance companies would be forced to increase the interest rates further in April 2006.

However, bankers feel that the present liquidity situation is a temporary phenomenon and would get over soon.

''Right now the liquidity position is stable,'' Mr Pandit said.

UNI