SBI cuts lending and retail deposit rates—Here’s what changes from Dec 15

The State Bank of India (SBI), India's largest lender, has announced marginal reductions in major lending rates and select term deposit rates, which will take effect from December 15.

SBI revises interest rates

The bank decreased the interest rate on the 2-year term to below the 3-year term to 6.40 per cent from 6.45 per cent. The senior citizens will get the 50 basis points (bps) premium above this rate, and their rate was reduced to 6.90 per cent from 6.95 per cent. The other retail term deposit rates were unchanged as per the bank announcement.

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The changes impact domestic retail term deposits of less than Rs 3 crore, the Marginal Cost of Funds‑based Lending Rate (MCLR), the External Benchmark Linked Rate (EBLR) and the Base Rate.

The bank has brought down the popular 444‑day 'Amrit Vrishti' deposit rate to 6.45 per cent from the previous 6.60 per cent.

Additionally, the SBI eased the borrowing costs of home, auto and MSME loans by reducing or Marginal Cost of Funds based Lending Rate (MCLR) rates across all tenors by 5 basis points.

MCLR rate for overnight and one month was decreased to 7.85 per cent, 8.25 per cent for three months, 8.60 per cent for six months, 8.70 per cent for one year, 8.75 per cent for two years and 8.80 per cent for three years.

Moreover, the External Benchmark Lending Rate (EBLR) that is applied to many floating-rate retail loans was decreased by 25 basis points to 7.90 per cent from 8.15 per cent. The Base Rate or BPLR of a small group of traditional borrowers was lowered to 9.90 per cent from 10.00 per cent, effective the same day, according to IANS.

The government disclosed earlier this week that no capital infusion had been made in public sector banks by the government since the financial year 2022-23, as the banks had drastically enhanced their fiscal performance to gain profitability and solidified their capital position.

Meanwhile, the goods and services tax (GST) cut is forecasted to lower the consumer price index (CPI) inflation by approximately 25 basis points during September–November 2025 and could lessen 35 basis points this fiscal (FY26), according to a report by State Bank of India (SBI).