DHFL Rates, DHFL PLR – Aug 2017

• DHFL decides its own PLR from time to time
• The RBI or NHB do not mandate or decide the PLR of any NBFC or HFC. Since NBFC’s typically have a higher cost of raising funds and higher cost of operations than those of banks, mostly they tend to offer loans at higher interest rates compared to banks
• Sometimes, NBFC’s may have different benchmark PLR’s by customer segment and by product. E.g., an NBFC may have one PLR for retail and another one for corporate
• When pricing a loan, DHFL typically offers a discount to the PLR to arrive at its lending rate

DHFL PLR Vs.RBI

• RBI/ NHB require each NBFC/ HFC to set their own PLR rate based on their cost of funds. So, DHFL decides its own base rate from time to time based
• Note that the RBI/ NHB does not decide the PLR rate

Changes in PLR of DHFL

• PLR rate can be revised by DHFL periodically in line with changes in interest rates in the market

DHFL home loan interest rate and PLR

• Every floating rate loan sanctioned by DHFL is benchmarked to its PLR rate
• The applicable rate of interest on a floating rate loan will consist of two parts – the applicable PLR and a spread or margin (which is typically negative in case of NBFC’s and HFC’s)
• Your loan from DHFL will be repriced periodically depending upon change in PLR. So, a home loan from DHFL will be repriced every time the PLR of DHFL changes. Say, you take a loan at PLR minus 6.75% spread when the PLR is 16.25%. This loan will initially be priced at 9.50%. Whenever DHFL changes in PLR rate, the applicable rate of interest will change correspondingly.

Past trend of DHFL PLR vs RBI Repo Rate