Bank of Baroda, Canara Bank Raise Lending Rates After RBI Stays Repo Rate

Bank of Baroda and Canara Bank have raised their lending rates. These changes are effective from June 12, 2026. Loans linked to these rates will become more expensive. This follows the Reserve Bank of India's decision to maintain the repo rate. HDFC Bank also adjusted its MCLR rates recently.

Bank of Baroda and Canara Bank have increased their Marginal Cost of Funds Based Lending Rates (MCLR) by up to 5 basis points (bps) on select tenures. The revised MCLR rates of both banks are effective from June 12, 2026. A basis point is the one-hundredth of a percentage point.

With an increase, Bank of Baroda and Canara Bank’s loans linked to MCLR are set to become costlier as they may increase interest rates.

The decision came a week after the Reserve Bank of India (RBI) maintained the repo rate at 5.25% in its monetary policy meeting on June 5, 2026.

What is MCLR?

MCLR is the minimum interest rate a financial institution needs to charge for a specific loan. It dictates the lower limit of the interest rate for a loan. This rate limit is set in stone for borrowers unless specified otherwise by the RBI. The RBI introduced MCLR in 2016.

Canara Bank lending rates

Canara Bank has revised its MCLRs across short-term tenors. The overnight MCLR has been increased by 5 basis points from 7.90% to 7.95%. Similarly, the one-month MCLR has been raised from 7.95% to 8.00%, while the three-month MCLR has moved up from 8.20% to 8.25%. The six-month MCLR has also been increased by 5 basis points, from 8.55% to 8.60%. Other tenure rates were kept unchanged.

Sr. No.

MCLR Tenor Existing Rate (%) Rate w.e.f. 12.06.2026 (%) Change (bps) 1 Overnight MCLR 7.9 7.95 5 2 One Month MCLR 7.95 8 5 3 Three Month MCLR 8.2 8.25 5 4 Six Month MCLR 8.55 8.6 5 5 One Year MCLR 8.75 8.75 No change 6 Two Year MCLR 9 9 No change 7 Three Year MCLR 9.05 9.05 No change

Bank of Baroda lending rates

The bank has increased its MCLRs by 5 basis points each across five tenors. The overnight MCLR has been revised upward from 7.80% to 7.85%, while the one-month MCLR has increased from 7.90% to 7.95%. The three-month MCLR has increased from 8.15% to 8.20%, and the six-month MCLR from 8.45% to 8.50%. The one-year MCLR, which is commonly used as a benchmark for many retail loans, has also been raised by 5 basis points from 8.70% to 8.75%.

MCLR Tenor

Existing MCLR (%) MCLR w.e.f. 12 June 2026 (%) Change (bps) Overnight 7.8 7.85 5 One Month 7.9 7.95 5 Three Month 8.15 8.2 5 Six Month 8.45 8.5 5 One Year 8.7 8.75 5

HDFC Bank lending rates

HDFC Bank has increased its MCLR on most of its loan tenures effective June 8, 2026. The overnight MCLR has been raised by 5 basis points from 8.05% to 8.10%. The 3-month MCLR has increased from 8.15% to 8.20%, while the 6-month MCLR has gone up from 8.30% to 8.35%.

Similarly, the 1-year MCLR, which is commonly used as a benchmark for many retail loans, has been increased by 5 basis points from 8.35% to 8.40%. On a 2-year tenure, MCLR has been raised by 10 basis points from 8.45% to 8.55%. The 3-year MCLR has also been increased by 5 basis points from 8.60% to 8.65%.

The only tenure that remained unchanged is the 1-month MCLR, which remains at 8.05%.

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