The State Bank of India (SBI), India's largest PSU bank, on Thursday, raised lending rates from 7.95 percent to 8.15 percent.
A Reuters report said that the SBI raised marginal cost-based lending rates (MCLR) across most maturities, effective immediately.
The move comes a day after the SBI increased rates on term deposits by 10-75 basis points (bps) which translates to increase in the interest rate on fixed deposits (FD) for a two- to three-year maturity to 6.50% from 6% a year.
The rise in SBI deposit rates, and subsequently lending rates signals the turning of the interest rate cycle despite the Reserve Bank of India (RBI) not making any rate changes in its last two monetary policy reviews, a Livemint report said.
SBI term deposits for 7 to 45 days will earn an annual interest rate of 5.75 per cent, up from 5.25 per cent earlier. For one year deposits, SBI customers will now earn 6.40 per cent from 6.25 per cent earlier, while those deposits maturing between two years and 10 years will earn 6.50 per cent, compared with 6 per cent earlier. For senior citizens, the revised interest rates are 7 per cent on their deposits, up from earlier 6.50 per cent, said a TOI report.