Overview

• Effective August 1, SBI raised the upper limit on its home loan interest rate from 8.45% to 8.70% for new borrowers.
• Borrowers with weaker credit profiles will see higher EMIs—for a ₹30 lakh, 20-year loan, monthly payments jump by about ₹450, adding over ₹1 lakh in total costs.
• All SBI home loans remain tied to the External Benchmark Lending Rate of roughly 8.15%, so the move widens risk-based spreads even as the policy rate falls.
• Other public-sector lenders such as Union Bank, Bank of India and Bank of Maharashtra may widen spreads next to defend margins against sticky deposit costs.
• Home loan growth cooled sharply to 9.6% year-on-year through June 2025, down from 36.3% a year earlier, signaling a shift from growth to profitability focus.