On Thursday, private sector lender - ICICI Bank announced a cut in home loan rate by 0.15 per cent for novel borrowers, joining the rate cut started by larger rival SBI. Home loans up to Rs75 lac for women borrowers will now attract an interest of 9.15 per cent from the earlier rate of 9.30 per cent. In the same time, the novel rate for salaried class has been lowered to 9.20 per cent, as against 9.35 per cent earlier.
The novel rate is effective from 2nd November, a day after the ICICI bank lowered MCLR - marginal cost of funds based lending rate by 0.1 per cent.
On Wednesday, SBI had slashed interest rates by 0.15 per cent for its home loans up to Rs.75 lac. SBI home loan is available at 9.15 per cent while women borrowers shall get it at 9.10 per cent interest. As per analysts, the rate reduction effected by large players would put some pressure on others to follow suit and remain in competition. As there is hardly any credit demand from the corporate sector, most banks are chasing retail loans to keep their balance sheet ticking, the analysts added. Meanwhile, ICICI Bank share price was trading at Rs.269, down 0.28 per cent on the NSE today.
On Wednesday, ICICI Bank launched a product for salary account holders who had taken a loan from it, offering credit between Rs.5 lac and Rs.1 cr against property owned by them.
The bank said in a statement that the product - ICICI Bank Home Overdraft offers dual benefit of a term loan as well as an overdraft facility. Those buying the overdraft loan from the bank shall be able to utilize the funds for their personal needs like education, home renovation, medical treatment, marriage and overseas travel, among others.
Customers shall have the facility to avail a minimum of 10 per cent of the total amount as term loan while maximum 90 per cent as overdraft.
ICICI Bank said the interest on term loan would be charged as per the EMI, while on the overdraft the charges shall be only on the utilized amount for the period the funds are used.
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