HDFC Bank cuts rates. Bank of Baroda raises them.

HDFC Bank cuts rates. Bank of Baroda raises them.

So… are lending rates actually falling?

Not that simple.

HDFC Bank has cut its MCLR by 5 bps across most tenures, effective August 7.

At the same time, Bank of Baroda has increased its 3-month MCLR by 10 bps, effective August 12.

Two major banks.

Two opposite decisions.

And here’s the part borrowers often miss:

A lower MCLR doesn’t automatically mean your EMI will fall.

The impact depends on whether your loan is MCLR-linked, your applicable spread, and your reset date.

Many newer floating-rate retail loans are linked to external benchmarks instead.