SBI Cuts Home Loan Rates: EMIs to Drop After PSU Bank Revises Lending Benchmarks

Bengaluru, Dec 13, 2025: The Reserve Bank of India’s Repo Rate drop by 25 bps was shortly followed by a press release from State Bank of India(SBI) announcing a reduction in key lending rates like MCLRs, EBLRs, and RLLRs, valid from December 15, 2025. The revision in rates is designed to lower borrowing costs for individual and business customers, corresponding with the easing in home loan EMIs, personal loans, and other credit products.

SBI's MCLR has been modified at all its tenors; as such, rates for short tenors like overnight MCLRs and one-month MCLRs were revised from 7.90% to 7.85%; the three-month rate was revised down from 8.30% to 8.25%, and the six-month MCLR now stands at 8.60%, slightly lower than 8.65% that was prevailing earlier. Notably, the benchmark also for one year, widely recognized and most sought after, has fallen to 8.70% from 8.75%, and so in two-year and three-year tenors as well. This is estimated to have a marginal impact on EMI payments by the borrowers.

Moreover, the State Bank of India recently announced a cut in its external benchmark lending rates and repo linked lending rates. The EBLR benchmark has been reduced from 8.15% plus credit risk premium (CRP) plus bank spread (BSP) to 7.90% plus CRP plus BSP. The RLLR, being directly linked to the RBI repo rate, has been reduced from 7.75% plus CRP to 7.50% plus CRP. Based on the terms of individual loans and stages of risk, borrowers migrating onto EBLR- or RLLR-linked loans could potentially experience lower interest rates and EMIs.

SBI has also changed the Benchmark Prime Lending Rate (BPLR) to 14.65 percent annually and the base rate to 9.90 percent effective December 15, 2025.

Thus, SBI customers now have access to cheaper loans so that monthly repayments can be conveniently adjusted, making this one of the biggest rate cuts for PSU banks this year.