Planning Home Loan Or Car Loan? These 3 Banks Have Announced Major Interest Rate Cuts

Last Updated:June 12, 2025, 11:39 IST

According to experts, the rate cuts will ease the financial burden on the public, offering significant relief to those seeking home, auto, personal and MSME loans

In a major boost for borrowers, several public sector banks, including Union Bank of India, Canara Bank, and Indian Overseas Bank (IOB), have reduced their loan interest rates by up to 0.50 percent. The move comes after the Reserve Bank of India’s (RBI) cut the repo rate by 0.5 percent to 5.5 percent and reduced the cash reserve ratio (CRR) by 1 percent last week.

Experts believe that this move will provide substantial relief for individuals seeking home, auto, personal, and MSME loans, thereby easing the financial burden on the general public.

Prior to this, Bank of Baroda (BoB) had also reduced its Repo Linked Lending Rate (RLLR) by 0.50 percent. Concurrently, private bank HDFC Bank has decreased its Marginal Cost of Funds Based Lending Rate (MCLR) by up to 0.10 percent for various periods, benefiting customers with loans linked to MCLR.

Union Bank Of India

Union Bank of India has announced a reduction in its External Benchmark Lending Rate (EBLR) and Repo Linked Lending Rate (RLLR) by 0.50 percent, in line with the RBI’s repo rate cut. This decision will allow customers to secure loans at more affordable rates.

Indian Overseas Bank

Similarly, Indian Overseas Bank (IOB) has reduced its loan interest rates by 0.50 percent. This reduction was decided during the bank’s Asset-Liability Management Committee (ALCO) meeting. IOB’s new Repo Linked Lending Rate (RLLR) has now decreased from 8.85 percent to 8.35 percent.

Canara Bank

Canara Bank has also announced a 0.50 percent reduction in its repo-based interest rate, bringing the new RLLR down from 8.75 percent to 8.25 percent. These new rates will come into effect from Wednesday.

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