Home loan EMIs likely to fall for these borrowers as banks revise lending rates
October 13, 2025
Bank of Baroda, Indian Bank, and IDBI Bank have lowered their Marginal Cost of Funds-based Lending Rates (MCLR) for select tenures in October. These rate cuts, following the RBI's Monetary Policy Committee meeting, are expected to provide relief to borrowers with floating rate loans linked to MCLR, potentially reducing their EMIs or loan terms.
Synopsis
Bank of Baroda, Indian Bank, and IDBI Bank have lowered their Marginal Cost of Funds-based Lending Rates (MCLR) for select tenures in October. These rate cuts, following the RBI's Monetary Policy Committee meeting, are expected to provide relief to borrowers with floating rate loans linked to MCLR, potentially reducing their EMIs or loan terms.
Bank of Baroda (BoB), Indian Bank and IDBI Bank have reduced their marginal cost of funds-based lending rates (MCLR) in October for select tenures. After the MCLR rate revision borrowers whose floating rate loans are linked with MCRL can anticipate some relief on loan repayments as their EMIs are set to fall. The rate cuts follow the Reserve Bank of India's (RBI) October 2025 Monetary Policy Committee (MPC) meeting, in which the central bank maintained the repo rate at 5.50% with a neutral stance. BoB, Indian Bank and IDBI Bank have slightly lowered their short-term MCLR rates, which may result in lower monthly loan payments or shorter loan terms for borrowers who currently have MCLR floating rate loans.
Also read: SBI Card festive season offers: Get up to Rs 20,000 voucher, free international lounge access and other benefits on SBI credit cards
What is MCLR?
The marginal cost of funds-based lending rate, or MCLR, serves as a benchmark rate for banks to determine the interest rates on various floating-rate loans, such as home, personal, and automobile loans. A decrease in MCLR indicates a possible decline in loan EMIs for borrowers or a shorter tenure, which benefits borrowers. MCLR does not apply to new loans, as new floating rate loans are linked to the External Benchmark Lending Rate (EBLR). Banks also provide borrowers with the option to transition from MCLR to an EBLR-linked loan.
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Bank of Baroda MCLR rates
The bank has revised its Marginal Cost of Funds-based Lending Rates (MCLR) with effect from October 12, 2025. As per the bank’s website, the overnight MCLR remained unchanged at 7.85%, one-month MCLR has been reduced from 7.95% to 7.90%. While the three-month MCLR stands at 8.20%, the six-month rate has been reduced from 8.65% to 8.60%. One-year MCLR has also been reduced from 8.80% to 8.75%.
Sr. No. MCLR Benchmark MCLR in (%) w.e.f 12.10.2025 1 Overnight MCLR 7.85 2 1 Month MCLR 7.9 3 3 Month MCLR 8.2 4 6 Month MCLR 8.6 5 1 Year MCLR 8.75
IDBI Bank MCLR rates
IDBI Bank’s MCLR rates are currently as follows: the bank has reduced overnight MCLR from 8.05% to 8%, while the one-month MCLR has been trimmed from 8.20% to 8.15%. For other tenures, lending rates remain unchanged as the three-month MCLR is 8.50% and the six-month MCLR is 8.70%. Among higher tenors, the one-year MCLR remains the same at 8.75%, the two-year MCLR at 9.30%, and the three-year MCLR at 9.70%. The revised rates are effective from October 12, 2025.
Tenor MCLR Overnight MCLR 8.00% One Month MCLR (1M) 8.15% Three Month MCLR (Q) 8.50% Six Month MCLR (HY) 8.70% One year MCLR (Y) 8.75% Two Year MCLR (2Y) 9.30% Three Year MCLR (3Y) 9.70%
Latest Canara Bank lending rates
Public sector lender Canara Bank kept its lending rates unchanged. Its overnight MCLR now stands at 7.95%, and its one-month MCLR is 8%. The bank's three-month MCLR is now 8.20%, while the six-month MCLR is 8.55%. The one-year MCLR stands unchanged at 8.75%. Similarly, the two-year and three-year MCLRs stand at 8.90% and 8.95%, respectively.
Indian Bank MCLR rates
The bank has made revisions to its marginal cost of funds-based lending rates (MCLR) across select tenures. The overnight MCLR has been reduced from 8.05% to 7.95%, while the one-month rate has been lowered from 8.30% to 8.25%. However, there has been no change in the three-month, six-month, and one-year MCLR, which remain the same at 8.45%, 8.70%, and 8.85%, respectively. The new rates are effective from October 3, 2025.
MCLR: S.No Tenor Existing Rate Revised Rate 1 Overnight 8.05% 7.95% 2 1 month 8.30% 8.25% 3 3 months 8.45% 8.45% 4 6 months 8.70% 8.70% 5 1 Year 8.85% 8.85%
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Bank of Baroda, Indian Bank, and IDBI Bank have lowered their Marginal Cost of Funds-based Lending Rates (MCLR) for select tenures in October. These rate cuts, following the RBI's Monetary Policy Committee meeting, are expected to provide relief to borrowers with floating rate loans linked to MCLR, potentially reducing their EMIs or loan terms.
Bank of Baroda (BoB), Indian Bank and IDBI Bank have reduced their marginal cost of funds-based lending rates (MCLR) in October for select tenures. After the MCLR rate revision borrowers whose floating rate loans are linked with MCRL can anticipate some relief on loan repayments as their EMIs are set to fall. The rate cuts follow the Reserve Bank of India's (RBI) October 2025 Monetary Policy Committee (MPC) meeting, in which the central bank maintained the repo rate at 5.50% with a neutral stance. BoB, Indian Bank and IDBI Bank have slightly lowered their short-term MCLR rates, which may result in lower monthly loan payments or shorter loan terms for borrowers who currently have MCLR floating rate loans.
Also read: SBI Card festive season offers: Get up to Rs 20,000 voucher, free international lounge access and other benefits on SBI credit cards
What is MCLR?
The marginal cost of funds-based lending rate, or MCLR, serves as a benchmark rate for banks to determine the interest rates on various floating-rate loans, such as home, personal, and automobile loans. A decrease in MCLR indicates a possible decline in loan EMIs for borrowers or a shorter tenure, which benefits borrowers. MCLR does not apply to new loans, as new floating rate loans are linked to the External Benchmark Lending Rate (EBLR). Banks also provide borrowers with the option to transition from MCLR to an EBLR-linked loan.
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Bank of Baroda MCLR rates
The bank has revised its Marginal Cost of Funds-based Lending Rates (MCLR) with effect from October 12, 2025. As per the bank’s website, the overnight MCLR remained unchanged at 7.85%, one-month MCLR has been reduced from 7.95% to 7.90%. While the three-month MCLR stands at 8.20%, the six-month rate has been reduced from 8.65% to 8.60%. One-year MCLR has also been reduced from 8.80% to 8.75%.
Sr. No. MCLR Benchmark MCLR in (%) w.e.f 12.10.2025 1 Overnight MCLR 7.85 2 1 Month MCLR 7.9 3 3 Month MCLR 8.2 4 6 Month MCLR 8.6 5 1 Year MCLR 8.75
IDBI Bank MCLR rates
IDBI Bank’s MCLR rates are currently as follows: the bank has reduced overnight MCLR from 8.05% to 8%, while the one-month MCLR has been trimmed from 8.20% to 8.15%. For other tenures, lending rates remain unchanged as the three-month MCLR is 8.50% and the six-month MCLR is 8.70%. Among higher tenors, the one-year MCLR remains the same at 8.75%, the two-year MCLR at 9.30%, and the three-year MCLR at 9.70%. The revised rates are effective from October 12, 2025.
Tenor MCLR Overnight MCLR 8.00% One Month MCLR (1M) 8.15% Three Month MCLR (Q) 8.50% Six Month MCLR (HY) 8.70% One year MCLR (Y) 8.75% Two Year MCLR (2Y) 9.30% Three Year MCLR (3Y) 9.70%
Latest Canara Bank lending rates
Public sector lender Canara Bank kept its lending rates unchanged. Its overnight MCLR now stands at 7.95%, and its one-month MCLR is 8%. The bank's three-month MCLR is now 8.20%, while the six-month MCLR is 8.55%. The one-year MCLR stands unchanged at 8.75%. Similarly, the two-year and three-year MCLRs stand at 8.90% and 8.95%, respectively.
Indian Bank MCLR rates
The bank has made revisions to its marginal cost of funds-based lending rates (MCLR) across select tenures. The overnight MCLR has been reduced from 8.05% to 7.95%, while the one-month rate has been lowered from 8.30% to 8.25%. However, there has been no change in the three-month, six-month, and one-year MCLR, which remain the same at 8.45%, 8.70%, and 8.85%, respectively. The new rates are effective from October 3, 2025.
MCLR: S.No Tenor Existing Rate Revised Rate 1 Overnight 8.05% 7.95% 2 1 month 8.30% 8.25% 3 3 months 8.45% 8.45% 4 6 months 8.70% 8.70% 5 1 Year 8.85% 8.85%
(Catch all the Personal Finance News, Breaking News, Budget 2025 Events and Latest News Updates on The Economic Times.)
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