India's largest lender SBI today announced a steep interest rate reduction of up to 25 basis points for affordable housing loans, offering 8.35 per cent to new women borrowers.
Under the new government scheme, loans under Rs 30 lakh qualify for affordable housing.
In the male borrower category, the limited period offer is valid till July 31 and the reduction for the salaried is 20 bps to 8.40 per cent and that of non-salaried 15 bps, SBI Managing Director for national banking, Rajnish Kumar, told PTI in a concall.
The new rate reduction of 0.25 (rpt) 0.25 per cent for women will be for the salaried borrowers who can avail of 8.35 per cent, and for the non-salaried, it will be a 20 bps cut.
One percentage point is 100 basis points (bps).
"This a huge saving for the borrower as the 25 bps reduction translates into a saving of Rs 530 per month on EMIs," he said.
The new rates will be effective tomorrow.
"This is giant leap to give a fillip to the affordable housing segment keeping the Prime Minister's vision of providing 'housing for all' by 2022," Kumar said, adding that the lender now offers the lowest rates in the industry.
With a home loan book of Rs 2.23 trillion, SBI leads the segment with 25-26 per cent market share, Kumar said further.
However, he is of the view that the new offer may not push up its market share significantly as 45 per cent of its Rs 2.23 trillion home loan book is under Rs 30 lakh bracket.