HDFC Bank Raises MCLR: Will Your Loan EMI Increase?

HDFC Bank raised its marginal cost of fund-based lending rates (MCLR) on June 8, 2026. The rates have been hiked up to 10 per cent on the upper limit. As MCLR is the basis for determining the final lending rates for home loans, vehicle loans, and personal loans, among others, a hike in MCLR would affect the final rates for both existing and new borrowers. A high MCLR means higher equated monthly instalments (EMIs) for borrowers.

Notably, the Reserve Bank of India (RBI) kept the repo rate (the policy rate that has a rippling effect on banks’ lending and borrowing rates) unchanged at its recent monetary policy committee (MPC) meeting on June 5, 2026.

MCLR And Repo Rate

MCLR is different from repo rate. Repo rate is determined by the RBI, which is used as a monetary policy tool to regulate liquidity in the financial system and to manage inflation. MCLR, on the other hand, is a rate determined by the banks, internally based on their liquidity condition, repo rate, cash reserve ratio (CRR), tenure premium, and operating expenses.  

HDFC Bank MCLR

After the revision, the overnight MCLR has been hiked by 5 basis points (bps) to 8.10 per cent, while one-month MCLR remains unchanged at 8.05 per cent. For three-month and six-month tenures, MCLR hike is 5 bps to 8.20 per cent and 8.35 per cent, respectively.

The one-year MCLR, the rate typically used by banks for extending many retail loans, has been hiked from 8.35 per cent to 8.40 per cent. The highest hike of 10 bps is in the two-year tenure that rose from 8.45 per cent to 8.55 per cent. The three-year MCLR has been increased from 8.60 per cent to 8.65 per cent.

Here are the details of MCLR changes over the last three months.

Source: HDFC Bank Website

Will Your Loan EMI Increase?

MCLR is the minimum interest rate below which banks cannot offer loans. So, if the base is high, the final interest rates will also be high. The final rate that is offered to the borrowers is calculated based on the MCLR and the spread over it. The spread depends on the loan amount, the CIBIL score, and the tenure of the loan.