Bank of Maharashtra lowers home loan interest rate to 8.4%

13 Mar 2023 , 08:57 AM

In order to entice new customers and accelerate loan growth before the fiscal year’s end, Bank of Maharashtra lowered its home loan interest rates by 20 basis points to 8.40%, making it one of the lowest in the sector.

Hence, the state-owned lender becomes the second bank to lower house loan interest rates in as many days. Bank of Baroda reduced the rate by 40 basis points to 8.50% last Friday.

In response to a question on why the bank cut house loan rates even though the rate-tightening cycle is still ongoing, BoM managing director AS Rajeev told ET that it was a business plan to further improve the quality of retail advances, particularly home loan advances.

He claimed that the top borrowers with high Cibil scores receive the lowest rate on the market. Apparently, there are no defaults for this group.

As the borrower base expands, the bank also aims to capitalise on greater cross-selling opportunities. According to Rajeev, consumers who have better Cibil ratings frequently have respectable savings balances, and the average number of products sold to them is four.

According to BoM’s statement on Sunday, processing fees for home loans, gold loans, and vehicle loans had previously been waived.

Housing Development Finance Corporation and State Bank of India both offer mortgages with a minimum interest rate of 8.50%.

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