Relief will be given in EMI, these public sector banks reduced their interest rates so much

PNB, Indian Bank and Boi Cut Interest Rates

The big government banks of the country have given great relief to their customers. Punjab National Bank (PNB), Indian Bank and Bank of India have cut 5 basis points in their interest rates. With this, home loan, auto loan and other borrowers will now have to pay less interest. This cut has come into force from July 2025. The Reserve Bank of India (RBI) had reduced the repo rate by 100 basis points since February 2025, after which banks have taken this step.

What is MCLR?

First of all understand MCLR i.e. Marginal Cost of Funds based lending rates. This is the minimum interest rate on which banks charge interest for a loan. This rate sets the minimum limit of interest rate of loan. According to RBI rules, banks cannot give loans at low interest than this rate, unless special discounts are given.

PNB gave relief

Punjab National Bank, which is the second largest government bank in the country, has cut 5 basis points in MCLR for all periods. The new rates are applicable since 1 July 2025.

• One day mclr: 8.25% to 8.20%.
• One month mclr: 8.40% to 8.35%.
• Three months McLr: 8.60% decreased to 8.55%.
• Six months mclr: 8.80% reduced to 8.75%.
• One year mclr: This rate important for home loan decreased from 8.95% to 8.90%.
• Three year old mclr: 9.25% reduced to 9.20%.

Indian Bank also reduced rates

Indian Bank has also cut 5 basis points in MCLR for some periods. These new rates are in force since 3 July 2025.

• One day mclr: No change at 8.20%.
• One month mclr: 8.45% decreased to 8.40%.
• Three months McLr: 8.65% reduced to 8.60%.
• Six months mclr: 8.90% decreased to 8.85%.
• One year mclr: 9.05% reduced to 9.00%.

Bank of India also decided

Bank of India has also reduced 5 basis points in MCLR for all periods. These new rates are in force since 1 July 2025.

• One day mclr: 8.15% decreased to 8.10%.
• One month mclr: 8.45% reduced to 8.40%.
• Three months McLr: 8.60% decreased to 8.55%.
• Six months mclr: 8.85% reduced to 8.80%.
• One year mclr: 9.05% decreased to 9.00%.
• Three year old mclr: 9.20% to 9.15%.

Customers will benefit

EMI's burden will be reduced by cutting the interest rates of these banks. This is good news, especially for those taking home loans and auto loans. After the reduction in RBI's repo rate, this step of banks is important towards speeding up the economy and giving relief to customers.