New Delhi, August 7: In a significant bonanza for credit seekers, the State Bank of India (SBI) on Wednesday slashed their lending rates, thereby turning an array of loans cheaper including those availed for buying homes. The decision was followed by the Reserve Bank of India's fourth consecutive cut in repo rate.

Repo rate, or the rate at which the central bank lends to their commercial counterparts, has been reduced by 35 basis points, scaling it to 5.40 per cent. The announcement was made by RBI Governor Shaktikanta Das while releasing the monetary policy report today. GDP Growth Estimate Scaled Down to 6.9% From 7% by RBI Amid Economic 'Slowdown'

Subsequently, the SBI issued a statement claiming that it has reduced marginal cost of funds-based lending or MCLR by 15 basis points. This marks the eight cut in MCLR rate by the State Bank in last 12 months -- cumulatively slashing it by 85 basis points.

"SBI has effected full transmission of repo rate cuts by RBI and has passed on the benefit of repo rate reduction by 85 basis points during the current financial year to its cash credit/overdraft customers with limits above Rs. 1 lakh," said the statement issued by the largest-state-run lender.

With the fresh reductions, the effective repo linked lending rate (RLLR) for cash credit and overdraft customers has been slashed to 7.65 per cent. The new rate will come into effect from September 1.

(The above story first appeared on LatestLY on Aug 07, 2019 03:37 PM IST. For more news and updates on politics, world, sports, entertainment and lifestyle, log on to our website latestly.com).