Indian Bank Reduces One-Year Lending Rate by 5 Basis Points

Public sector lender Indian Bank announced on Wednesday that it has reduced its one-year Marginal Cost of Funds Based Lending Rate (MCLR) by 5 basis points (bps), bringing it down to 9 per cent. The revised rate will come into effect from July 3, 2025.

In an official statement, the bank said the rate cut is part of its regular review of lending rates in line with the cost of funds. The one-year MCLR serves as a key benchmark for pricing various consumer loans, including auto loans, personal loans, and home loans.

This marginal reduction could lead to slightly lower borrowing costs for both existing and new customers whose loans are linked to the one-year MCLR benchmark.

The move comes at a time when banks are cautiously adjusting lending rates amid evolving liquidity conditions and monetary policy signals. While the reduction is modest, it may offer some relief to borrowers amid concerns over rising loan EMIs.

Indian Bank’s latest move reflects its effort to stay competitive and responsive to market dynamics while supporting customer affordability and credit demand.