Attention: your EMI is going to increase, SBI is going to increase interest rates

During the corona crisis, your loan EMI (monthly installment) is also going to increase. In the coming days, banks are preparing to increase the rate of interest on all loans including home, car, and personal. After this, you will have to pay more EMI against the loan.

                                      The country's largest bank State Bank of India (SBI) has increased the interest rates on home loans. SBI has increased the home loan interest rate by 25 basis points from April 1, as compared to March 2021. After this increase, the minimum rate of home loans from SBI has increased to 6.95% from 6.70% now.

                         This increase has been made by SBI after the loan EMI reached a 15-year low during the Corona epidemic. In such a situation, banking experts say that SBI is the top bank in the market. It acts as a trendsetter in the loan market. Now that SBI has increased the interest rates on home loans, in the coming days, other government and private banks will also follow it and will increase the interest rate. This will make all types of loans expensive.

Banks started increasing deposits

                           In recent times, many banks have increased interest rates on fixed deposits (FD). Many more banks, including HDFC Bank, Canara Bank, have increased this. While Canara Bank has increased the FD by 0.2%, HDFC has also raised the interest rate by 10-25 basis points on its fixed deposit scheme after 29 months. This increase has increased the fund cost of banks. This will affect the interest rate of the loan. That is, banks will increase interest rates to make up for it.

Loan at a fixed rate is still a profitable deal

                        Banking experts say that it is certain that banks will hike interest rates on loans in the coming days. For this increase does not have an immediate effect, it will be a profitable deal for new customers to take a loan at a fixed rate. Taking a car, home or another loan at a fixed rate will be beneficial because your interest rate remains low in it.

What options do existing customers have

                                                   Banks typically give customers the option of extending the loan term or EMI when interest rates rise. However, not all customers have the option to extend the loan term. According to banking experts, since banks generally do not allow the loan to extend beyond the actual term of the loan or the customer's retirement period, many customers have no other option but to keep the EMI period constant by paying a lump sum.