Bank of Baroda has announced a reduction in its car loan interest rates, effective immediately. The new floating car loan interest rates start at 8.15% per annum, down from 8.40% per annum. This rate cut is in addition to the previous reduction made by the bank after the Reserve Bank of India (RBI) cut the policy repo rate by 100 basis points. The new rate applies to loans for new car purchases and is linked to the borrower’s credit profile.
The bank has also reduced interest rates on mortgage loans, also known as Loan Against Property, from 9.85% per annum to 9.15% per annum, subject to certain conditions. According to Sanjay Mudaliar, Executive Director of Bank of Baroda, the rate cut is aimed at making car ownership more accessible and affordable during the festive season. He also noted that the reduced mortgage loan rates provide an opportunity for customers to unlock higher value from their property and raise additional funds at a lower interest rate.
The interest rate reduction on mortgage loans ranges from 55 basis points to 300 basis points, depending on the customer’s CIBIL score. The bank is also offering a fixed rate of interest on car loans, linked to its 6-month Marginal Cost of Lending Rate (MCLR), starting at 8.65% per annum. This move is expected to make car loans and mortgage loans more attractive to customers, especially during the festive season when many people look to make new purchases or investments.
The reduction in interest rates is a positive development for potential car buyers and property owners, as it can help reduce their monthly loan repayments and make their loans more affordable. With the new rates, Bank of Baroda is attempting to stay competitive in the market and attract more customers. The bank’s decision to link the interest rates to the borrower’s credit profile also highlights the importance of maintaining a good credit score to avail of better loan rates. Overall, the reduction in interest rates by Bank of Baroda is a welcome move that can benefit many customers looking to purchase a new car or unlock value from their property.