New Delhi, July 4 -- Punjab National Bank (PNB) has stated that it is reducing its Marginal Cost of Funds Based Lending Rate (MCLR) by 5 basis points (bps) on several loan tenors that should help ease the burden on existing and prospective borrowers. This change came into effect on July 1, 2025 and has provided borrowers with some respite in a time of rising interest rates.

With a few exceptions, the MCLR is the minimum interest rate a bank is allowed by law to lend, and the MCLR is important to compute loan interest rates, especially for products like home loans, personal loans, auto loans, and student loans.

Since MCLR is generally used to determine the interest rate to be charged on floating-rate loans, lending rates go down when MCL...