HDFC Bank Cuts MCLR by 5 Basis Points, Effective August 7, 2025

HDFC Bank has announced a 5-basis-point (bps) cut in its Marginal Cost of Funds-based Lending Rates (MCLR) across various loan tenures. The change, effective from August 7, 2025, applies to loans linked to the MCLR benchmark. This revision will reduce the cost of borrowing for customers with such loans.

Breakdown of New MCLR Rates

The revised MCLR rates range from 8.55% to 8.75%, down from the previous range of 8.60% to 8.80%. The updated rates for different tenures are as follows:

• Overnight & 1 Month: 8.55% (previously 8.60%)
• 3 Months: 8.60% (previously 8.65%)
• 6 Months: 8.70% (previously 8.75%)
• 1 Year: 8.70%
• 2 Years: 8.75% (unchanged)
• 3 Years: 8.75% (previously 8.80%)

Borrowers with loans linked to MCLR, such as home loans, car loans, and personal loans, will see a decrease in their interest rates during their reset periods. Loans that are linked to external benchmarks like the RBI’s repo rate will not be affected by this change.

What is MCLR?

The MCLR is the minimum interest rate set by banks, including HDFC Bank, for various loan products. It is determined based on factors such as the bank's cost of funds, operating costs, and the tenure of the loan. This rate directly impacts the interest rate for loans linked to MCLR.

Read More: HDFC Bank; Posted ₹181.6 Billion Profit in Q1 FY26 Results!

Conclusion

HDFC Bank's reduction in MCLR by 5 basis points will benefit borrowers with MCLR-linked loans. The changes apply from August 7, 2025, and will slightly lower EMI payments for customers at their next reset cycle. Borrowers should be aware of their loan reset dates to take advantage of the new rates.

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