Srinagar, Aug 19: J&K Bank has lowered its marginal cost of funds-based lending rate (MCLR) by 0.10 percent for various tenors following the decrease in repo rate by the Reserve Bank of India (RBI).
The bank after reviewing the MCLR for different tenors lowered its benchmark one-year MCLR to 8.75 pc from 8.85 pc effective from August 10, 2019.
The marginal cost of funds-based lending rate (MCLR) is the minimum interest rate that a bank can lend at and is a tenor-linked internal benchmark, which means the rate is determined internally by the bank depending on the period left for the repayment of a loan.
The Reserve Bank of India introduced the MCLR methodology for fixing interest rates from 1 April 2016. It replaced the base rate structure, which had been in place since July 2010.
Pertinently, most of the consumer loans including personal, auto and home loans are priced on the basis of one-year MCLR.