Recently, the RBI cut the repo rate, and now six major banks in the country have reduced home loan interest rates. These include big banks like Canara Bank, Punjab National Bank (PNB), Union Bank of India, and Bank of Baroda. They have lowered the Repo Linked Lending Rate (RLLR) by up to 0.25%. Throughout this article, we will share all the details regarding this update.

What is RLLR?

RLLR (Repo Linked Lending Rate) is the rate at which banks offer loans to customers, directly linked to the RBI’s repo rate. When the RBI changes its repo rate, the interest rate on home loans tied to RLLR will also change. Most customers prefer floating-rate home loans, which are linked to RLLR. After a reduction in RLLR, banks give customers the option to either lower their EMI or shorten the loan tenure.

Which Banks Reduced Home Loan Interest Rates?

Following the RBI’s repo rate cut, six major banks have reduced home loan interest rates. Here’s a look at the banks and their new rates:

1. Canara Bank

Canara Bank has reduced its RLLR from 9.25% to 9.00%, effective from February 12, 2025. This rate will apply to accounts opened after this date.

2. Bank of Baroda

Bank of Baroda has cut its RLLR to 8.90%, effective from February 10, 2025. Both existing and new customers will benefit from this change.

3. Bank of India

Bank of India has lowered its RLLR from 9.35% to 9.10%, effective from February 7, 2025. This will reduce EMIs for both new and existing customers.

4. Union Bank of India

Union Bank of India has reduced its RLLR from 9.25% to 9.00%, effective from February 11, 2025. New borrowers will benefit from this lower rate.

5. Indian Overseas Bank (IOB)

IOB has reduced its RLLR from 9.35% to 9.10%, effective from February 11, 2025.

6. Punjab National Bank (PNB)

PNB has cut its RLLR from 9.25% to 9.00%, effective from February 10, 2025. This change will make home loans cheaper for PNB customers.

Benefits for Home Loan Customers

The reduction in RLLR will benefit home loan customers by making new loans cheaper. Existing customers may see their EMIs decrease. Alternatively, they can choose to reduce their loan tenure instead of lowering the EMI, which will help them save on interest payments.