Mumbai: LIC Housing Finance on Saturday said it has reduced rate of interest on new home loans by 50 basis points. 

With this revision, interest rates on new home loan sanctions will now start from 7.50 per cent, effective June 19, coinciding with the company’s 36th Foundation Day.

This move follows the recent repo rate cuts announced by the RBI’s Monetary Policy Committee (MPC), with LIC HFL passing on the benefit to new home loan customers to encourage home ownership and improve affordability.

“As we mark our 36th Foundation Day, we remain committed to making home ownership more accessible. The rate cut is a continuation of our effort to align with RBI’s policy direction and pass on the benefits to our customers,” said Tribhuwan Adhikari, MD and CEO, LIC Housing Finance.

“We are confident this move will provide an added boost to housing demand, especially in the affordable and mid-income segments, where aspirations of owning a home are closely tied to interest rate dynamics,” he added.

Earlier this week, the State Bank of India (SBI) reduced its lending rate by 50 basis points following the Reserve Bank's policy rate cut. With the latest round of reduction, the Repo Linked Lending Rate (RLLR) of SBI would come down by 50 basis points to 7.75 per cent.

SBI has also reduced the External Benchmark Based Lending Rate (EBLR) by similar basis points to 8.15 per cent from 8.65 per cent earlier. The State Bank of India revised interest rates came into effect from June 15.

Following the RBI action, most of the banks have slashed lending rate. Earlier, HDFC bank had also cut its lending rate to offer a maximum interest rate of 6.6 per cent per annum on Fixed Deposits with principal amount less than Rs 3 crore for general citizens. (IANS)