Bank of Maharashtra MCLR Rates, Bank of Maharashtra Base Rate – May 2022

Bank of Maharashtra offers the following loans to its customer on these rates currently:

Bank of Maharashtra revises its MCLR rate on a monthly basis. Latest MCLR rates of Bank of Maharashtra as announced on 07 May 2022 are:

• Overnight MCLR Rate is 6.85%.
• 1 Month MCLR Rate is 6.95%.
• 3 Month MCLR Rate is 7.25%.
• 6 Month MCLR Rate is 7.30%.
• 1 Year MCLR Rate is 7.40%.
• 2 Year MCLR Rate is 0.00%.
• 3 Year MCLR Rate is 0.00%.
• 5 Year MCLR Rate is 0.00%.

• Effective 1st April 2016, Bank of Maharashtra has been directed by RBI to fix its loan interest rates benchmarked to MCLR rate which is based on its marginal cost of funds. Earlier, the bank fixed its loan interest rates to Base Rate, which was based on total cost of funds of the bank. Bank of Maharashtra MCLR rates for different tenors range from 6.85% to 7.40%.
• RBI allows banks to set their own MCLR Rate based on their marginal cost of funds which means the cost of raising new funds for the bank. So, Bank of Maharashtra decides and announces its MCLR rate regularly based on prescribed formula and policy rate changes by RBI in its monetary policy.
• Note that the RBI does not decide the MCLR Rate of any bank. RBI only announces the repo rate, which influences the cost of raising new funds for the bank. Banks may or may not decide to change their MCLR rate in response to changes in the repo rate. For instance, Bank of Maharashtra may decide to bring a lower cut in their MCLR rate compared to a Repo Rate cut. If RBI cuts the repo rate by 50 basis points or 0.5%, Bank Maharashtra may decide to cut its MCLR rate only by 0.25% based on its internal funding and liquidity position. Hence, it is important to compare the MCLR rate change of Bank of Maharashtra with that of RBI Repo Rate and MCLR Rate changes of other banks before taking a decision to take a loan from Bank of Maharashtra.
• MCLR rate can be revised by Bank of Maharashtra every month. However, it is not mandatory for Bank of Maharashtra to revise its rate every month and it may choose to retain the same rate for a longer period keeping them unchanged.
• As per the latest regulations given by RBI, with effect from April 1, 2019, all floating interest rates on retail loans are to be linked to external benchmark lending rates. These could be the RBI's repo rate, three-month treasury bill yield, six-month treasury bill yield or other benchmark rate published by the Financial Benchmarks India Pvt Ltd.This was done in view to promote the easier transmission of reduced interest rates to customers, which was not well done when rates were linked to MCLR.