MUMBAI: The average lending rate on fresh rupee loans across the banking system eased by 6 basis points (bps) in August over July to 8.75%, with private sector lenders leading the decline, central bank data showed.
One basis point is a hundredth of a percentage point.
Private banks cut rates by 15 bps to 9.44%, while public sector banks lowered their average lending rates by 7 bps to 8.06%. Foreign banks saw a marginal 3 bps drop to 8.22%.
On outstanding rupee loans, system-wide average lending rates softened by 6 bps month-on-month to 9.32% as of end-August. Private sector lenders reduced rates the most, by 10 bps to 10.22%, while PSU banks trimmed rates by 3 bps to 8.70%. Lending rates of foreign banks remained unchanged.
The Reserve Bank of India ( RBI) has cut the repo rate by 100 bps so far this year. The one-year median Marginal Cost of Funds-based Lending Rate ( MCLR) of scheduled commercial banks (SCBs) was unchanged at 8.60% in September 2025.
The share of loans linked to external benchmarks (EBLR) rose to 62.9% of total outstanding floating-rate rupee loans at end-June 2025, compared with 61.6% at end-March 2025. Loans linked to the MCLR stood at 33.8%, down from 34.9% in March.
On the deposit side, the weighted average domestic term deposit rate (WADTDR) on fresh rupee deposits eased to 5.56% in August from 5.61% in July. The WADTDR on outstanding rupee term deposits of SCBs moderated to 6.87% from 6.92%. Private banks cut deposit rates by 5 bps in August, while PSU banks lowered theirs by 4 bps.
One basis point is a hundredth of a percentage point.
Private banks cut rates by 15 bps to 9.44%, while public sector banks lowered their average lending rates by 7 bps to 8.06%. Foreign banks saw a marginal 3 bps drop to 8.22%.
On outstanding rupee loans, system-wide average lending rates softened by 6 bps month-on-month to 9.32% as of end-August. Private sector lenders reduced rates the most, by 10 bps to 10.22%, while PSU banks trimmed rates by 3 bps to 8.70%. Lending rates of foreign banks remained unchanged.
The Reserve Bank of India ( RBI) has cut the repo rate by 100 bps so far this year. The one-year median Marginal Cost of Funds-based Lending Rate ( MCLR) of scheduled commercial banks (SCBs) was unchanged at 8.60% in September 2025.
The share of loans linked to external benchmarks (EBLR) rose to 62.9% of total outstanding floating-rate rupee loans at end-June 2025, compared with 61.6% at end-March 2025. Loans linked to the MCLR stood at 33.8%, down from 34.9% in March.
On the deposit side, the weighted average domestic term deposit rate (WADTDR) on fresh rupee deposits eased to 5.56% in August from 5.61% in July. The WADTDR on outstanding rupee term deposits of SCBs moderated to 6.87% from 6.92%. Private banks cut deposit rates by 5 bps in August, while PSU banks lowered theirs by 4 bps.
You may also like
I-T drive to target tax evasion in joint deals
Alisson Becker forced off with injury as Liverpool given major headache
Bryan Mbeumo shows true character with 'carry him' message over Man Utd teammate
Coronation Street star praises soap for 'pushing boundaries' after Carl and James twist
Nicole Kidman supporting by family amid 'unwanted' Keith Urban divorce
