State-owned lender Indian Bank has announced a cut of 5 basis points in its marginal cost of funds based lending rate (MCLR) for one-year tenure.

The bank has decided to reduce the MCLR for one-year tenure by 5 basis points to 7.30 per cent effective from September 3, 2020, Indian Bank said in a regulatory filing.

All new retail loans (housing, education, vehicle), credit to MSMEs are linked to RLLR now. On Monday, the country’s second largest lender Punjab National Bank (PNB) had raised its RLLR by 15 basis points to 6.80 per cent, making loans costlier for new borrowers.