Axis Bank Loan Interest Rates: Axis Bank hikes interest rates on loans: EMIs to increase further

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Axis Bank has increased its marginal cost of funds-based lending rate (MCLR) by 10 basis points (bps) across tenors with effect from November 18, 2022.

According to the Axis Bank website, overnight and one-month MCLR stand at 8.25 percent; three-month MCLR is at 8.35 percent; six-month at 8.40 percent; one-year at 8.45 percent; two-year at 8.55 percent; and three-year at 8.60 percent.


Last time, the bank hiked MCLR by 25 basis points (bps) which was effective from October 18, 2022. Effective from September 17, 2022, the bank’s base rate is 9.15%.

Borrowers of home loans and other loans are expected to see a further increase in EMIs on their loan reset dates.

Important FAQs on MCLR as per Axis Bank website

What is MCLR?

According to the Axis Bank website, “MCLR stands for Marginal Cost of Funds based Lending Rate. MCLR is the benchmark rate below which the banks cannot provide loans to the customers who are availing loans linked to MCLR. This new benchmark rate is applicable for new loans sanctioned & credit limit renewed from April 1, 2016 onwards.”

What are the various types of benchmark under MCLR?

Currently, the Bank has published the following MCLR:

  • Overnight MCLR
  • One-month MCLR
  • Three-month MCLR
  • Six month MCLR
  • One year MCLR
  • Two year MCLR
  • Three year MCLR

What is the reset period for AXIS Bank Home/LAP Loans linked to MCLR?

The benchmark MCLR for Axis Home/ LAP loans is 6 months. The reset period would be every 6 months.

Will MCLR be different between Banks?

Yes, MCLR can be different between different banks as it will depend on marginal cost of funds, negative carry on account of CRR, operating costs, tenor premium of respective banks.

What does periodicity of reset means?

Banks can specify dates of interest reset which will be linked to either the date of first disbursement or date of review of MCLR/ REPO rate. The MCLR/ REPO rate prevailing on the day the loan is disbursed will be applicable till the next reset date, irrespective of the changes in the MCLR / REPO rate in the interim. For all loans linked to REPO rate, the reset frequency would be three months or as decided by the Bank, whichever is earlier. For example: the Home Loan/ LAP loans disbursed in the month of November 2019, would be due for reset in the month of February 2020 similarly all such loans disbursed in the months of December 2019 would be due for reset in the month of March 2020 and so on, unless there is a change in the Bank’s guidelines in which case the reset would occur as and when there is such change in the Bank’s guidelines.

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