With the onset of the festive season, multiple public sector and private sector lenders have rolled out new offers and discounts to attract customers at a time when interest rates are rising in the financial system. These offers are aimed at helping banks to boost their credit growth. Bank credit grew at 16.4 per cent to Rs 126.3 lakh crore in the fortnight ended September 23, 2022.
Banks such as State Bank of India, HDFC Bank, ICICI Bank, Punjab National Banks are offering discounted interest rates and have waived off processing fees on home and car loans. Some lenders are also offering discounts and cash backs on shopping using internet banking, mobile banking, credit and debit cards.
This comes at a time when the equated monthly installments (EMIs) have been on an upward climb with the Reserve Bank of India (RBI) resorting to a series of rate hikes to rein in inflation. The repo rate, the rate at which the RBI lends money to banks to meet their short term funding needs, has been hiked by 190 basis points since May this year.
The country’s largest lender State Bank of India is offering concessions of up to 0.25 per cent on home loans, 0.15 per cent on top up loans, and 0.30 per cent on loans against property. The bank said the interest rate for buyers of new home loans as well as takeovers will now start at 8.4 per cent and top-up loans for furnishings, renovation or home makeover will begin from 8.8 per cent. Besides, the lender has waived off processing fees on home loans up to January 31, 2023
“As we enter the festive season after a long period of muted celebrations due to Covid restrictions, our offers this festive season are aimed to provide much-needed support for prospective home buyers as they embark on their journey for home ownership,” said Alok Kumar Choudhary, managing director (retail banking and operations), SBI.
SBI said its asset under management (AUM) in the home loan segment has surpassed Rs 6 lakh crore.
Mortgage lender HDFC Ltd is giving a festive offer on home loans at 8.4 per cent. Its home loan rates, before this offer, were between 8.6 per cent and 9 per cent, depending on the loan amount and credit score of the borrower. Under the special festive offer, the home financier is offering just one rate of 8.4 per cent to borrowers with a credit score of 750 and above, irrespective of the loan amount.
Last month, private sector lender HDFC Bank announced festive offers across accounts, loans, cards and equated monthly installments. The offers will be available across online, offline, national, regional and hyperlocal merchants covering a wide range of categories including electronics, jewellery, travel, home decor, apparels, grocery, personal and business loans and commercial vehicles.
The bank is offering personal loans up to Rs 40 lakh in 10 seconds at an interest rate starting from 10.50 per cent. Customers can also avail collateral free business loan with 50 per cent off on processing fee. It has waived off processing fee on gold loans by 50 per cent.
ICICI Bank has also launched a festive bonanza wherein it is offering a wide range of offers for its customers. The customers can get discounts and cashbacks upto Rs 25,000 by using the bank’s credit/ debit cards, internet banking, consumer finance and cardless EMI. Earlier this month, Punjab National Bank, in a tweet, said it has fully waived off processing and documentation fees on car and home loans.
As part of its festive offer, state-run Union Bank of India is providing home loans starting at 8.25 per cent and car loans at 8.4 per cent. It has also waived off processing fees on car and home loans. The offer will be available to customers till November 11, 2022, as per the information mentioned on the bank’s website. The lender is also offering discounts to customers for transactions done on Bookmyshow, MakeMyTrip, Zomato, Swiggy and Goibibo.
