HDFC cuts home loan by 0.25%

MUMBAI: HDFC on Thursday cut its retail prime lending rate by 0.25% for the first time since July 2003, citing “improved operational efficiency and good quality portfolio”.

The cut though applicable to all home loan borrowers of HDFC, is aimed primarily at existing borrowers. They can now reset their current home loan rate at 10.25%, down from 10.50% earlier.
 
The new rate is applicable from Friday.

HDFC has been offering 10.25% floating rate for new customers from the last couple of months as a special offer, but old customers were so far kept out. The latest cut is aimed at passing on the lower rate to all.

HDFC’s cut increases the pressure on rivals ICICI and State Bank of India to also cut rates for existing customers. Both the banks said they are watching the market closely.