Canara Bank loans to get cheaper as bank has reduced its Repo-Linked Lending Rate (RLLR) and Marginal Cost of Funds based Lending Rate (MCLR) by 40 basis points and 20 basis points, respectively, with effect from June 7, 2020. The revised rate of interest based on new RLLR will be 6.90 per cent against 7.30 per cent now. The revised one-year benchmark MCLR will be 7.65 per cent against 7.85 per cent now.
Repo rate is the interest rate at which the Reserve Bank of India provides funds to banks to help them overcome temporary liquidity mismatches. Almost all Banks in India are using the repo rate as the external benchmark.
Canara Bank has linked all the loan products like personal or retail loans (housing, auto, etc.) and loans to Micro, Small and Medium Enterprises since October 01, 2019 to an external benchmark.