Dhan Laxmi Bank MCLR Rates, Dhan Laxmi Bank Base Rate – May 2022

Dhan Laxmi Bank offers the following loans to its customer on these rates currently:

Dhan Laxmi Bank revises its MCLR rate on a monthly basis. Latest MCLR rates of Dhan Laxmi Bank as announced on 01 May 2022 are:

• Overnight MCLR Rate is 7.30%.
• 1 Month MCLR Rate is 7.30%.
• 3 Month MCLR Rate is 8.20%.
• 6 Month MCLR Rate is 8.50%.
• 1 Year MCLR Rate is 8.70%.
• 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, Dhan Laxmi Bank 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. Dhan Laxmi Bank MCLR rates for different tenors range from 7.30% to 8.70%.
• 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, Dhan Laxmi Bank 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, Dhan Laxmi Bank 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%, Dhan Laxmi 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 Dhan Laxmi Bank with that of RBI Repo Rate and MCLR Rate changes of other banks before taking a decision to take a loan from Dhan Laxmi Bank.
• MCLR rate can be revised by Dhan Laxmi Bank every month. However, it is not mandatory for Dhan Laxmi Bank 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.