HDFC Bank, India’s largest private sector bank, has given a special gift to its customers before Diwali by reducing loan interest rates. The bank has lowered its MCLR (Marginal Cost of Funds Based Lending Rate) by 0.15%.
Since MCLR directly determines loan interest rates, any reduction in MCLR automatically lowers the rates on home, car, and personal loans. This means customers will benefit directly from lower EMIs.
Details of HDFC Bank’s MCLR Reduction
HDFC Bank has revised MCLR for different periods, including overnight, one month, three months, six months, one year, two years, and three years. The rates have been reduced by 0.05% to 0.15%, which will reduce the EMI amounts for loans.
HDFC Bank MCLR – October 2025
| Period | New MCLR (Oct 7, 2025) | Old MCLR (Sep 7, 2025) |
|---|---|---|
| Overnight | 8.45% | 8.55% |
| One month | 8.40% | 8.55% |
| Three months | 8.45% | 8.60% |
| Six months | 8.55% | 8.65% |
| 1 year | 8.55% | 8.65% |
| 2 years | 8.60% | 8.70% |
| 3 years | 8.65% | 8.75% |
Impact of MCLR on Loans
When a bank changes its MCLR, it affects loans with floating interest rates, such as home loans, personal loans, and car loans. If MCLR increases, EMIs or loan terms go up because interest rates rise. Conversely, a decrease in MCLR lowers EMIs.
How is MCLR Determined?
Banks calculate MCLR based on factors like deposit interest rates, operating costs, and CRR (Cash Reserve Ratio). Changes in the RBI’s repo rate also affect MCLR.