HDFC Bank has again revised its benchmark prime lending rate (BPLR). Lender has raised its BPLR by 50bps to 16.25 percent. The revised rates will be applicable from immediate effect.
Thus all BPLR-linked loans, including vehicle and personal loans, which were taken by the bank customers before July, 1 2010, will rise in respective proportions.
Under BPLR the customers can avail loans at a discounted rate to the BPLR offered by the lender. As per Reserve Bank of India’s directive from July 1, 2010 all the banks have moved to the base rate system and lending loans to the new borrowers on the base rate. HDFC has set its base rate at 7.25%.
A senior bank official said due to rising cost of funds bank has raised its BPLR. Earlier bank had raised term deposit rates across various maturity periods.
The official said, “Deposit rates in the banking system could move up further by 50-75 basis points by the end of the financial year. Depending on credit demand, base rate could also come up for review in October.”
However, in the last one month almost all the banks, including the State Bank of India, Punjab National Bank, ICICI Bank, Union Bank of India and IDBI Bank have increased their BPLRs on an average by 50-75 basis points.
PNB has raised its BPLR to 11.75 per cent from 11 per cent with effect from August 1. Union Bank hiked to 12.25 per cent from 11.75 per cent with effect from August 4. SBI raised its BPLR by 50 basis points to 12.25 per cent with effect from August 17. ICICI Bank increased BPLR by 50 basis points to 16.25 per cent with effect from August 18.
All the banks have also raised their term deposit rates by 25-150 basis points across various maturity periods.
According to financial analysts, bank by rising the BPLR will be try to move the existing loan customers to the base rate. Because banks do not want to be under the burden of administering two benchmark lending rates.
Tuesday, September 7, 2010
Thursday, July 22, 2010
HDFC’s education arm Credila to lend more this fiscal
Housing Development Finance Corporation (HDFC), educational loan unit Credila Financial Services has set a target of increasing its loan book 2.5 times in the current financial year.
HDFC, early this month acquired an additional 10 per cent with which its stake in Credila increase to 51 per cent, is planning to take control of the distribution network and customer base of HDFC Bank to expand.
Credila Country Head Prashant Bhonsle said: “We have so far disbursed over Rs 40 crore and plan to reach Rs 100 crore by March 2011. HDFC can help us scale up quickly. Along with its brand equity, we can leverage its distribution structure and network”.
The public sector banks (PSBs) are the main players of the education loan. To be in competition with PSBs Credila has to cover a wide distance.
In 2009-10 PSBs disbursed educational loans worth Rs 8,000 crore to 320,000 students while there outstanding loans amounted to Rs 35,628.33 crore at the end of March 2010.
He said, “We can access its (HDFC’s) existing customers and database. It will not only help us expand but also bring down the cost of funds.”
The company is also having talks with other banks in order to diversify its sources of funds. PNB is giving credit whereas CARE has assigned a “BBB”-rating for its term loan facility (Rs 100 crore).
Currently Credila is doing 65 per cent of lending, to students studying within the country and the loan is given mainly for management courses in India, in the United States the disbursement is largely for masters in science, followed by management courses.
Bhonsle said, “This is an asset class in India which has not been focused on as a separate venture. While PSBs have been offering student loan services, they have been selling it as part of the product portfolio they offer.”
Giving details on where does Credila stands out vis-à-vis banks; Bhonsle says the loan facilities offered by banks are mostly identical. Moreover banks sanction loans only after a student has attained admission. Whereas, non-banking financial companies based on domain expertise and their understanding of the background, approve loans before admission.
Credila says that it is more rationalized on courses and career prospects for students, due to which it is more flexible. It gives loans against less security (collateral) as compared to big commercial banks. Bhonsle said, “We are flexible. Our domain expertise helps us extend this facility in such a large market of opportunity.”
It also has a different approach. To get loan student has to visit bank branch whereas Credila reaches out to students for loans.
“Students and parents want the kind of help that we are offering –reaching their door steps. If someone comes to them and explains everything, it makes sense. Small things are of large importance,” added Bhonsle.
Credila’s keep its back-end operations updated on education institutes. It has a database of more than 20,000 colleges.
The company is offering loans between interest rates of 9.75 per cent and 12.5 per cent and provides loans up to Rs 50 lakh, while PSBs do not lend more than Rs 20 lakh.
HDFC, early this month acquired an additional 10 per cent with which its stake in Credila increase to 51 per cent, is planning to take control of the distribution network and customer base of HDFC Bank to expand.
Credila Country Head Prashant Bhonsle said: “We have so far disbursed over Rs 40 crore and plan to reach Rs 100 crore by March 2011. HDFC can help us scale up quickly. Along with its brand equity, we can leverage its distribution structure and network”.
The public sector banks (PSBs) are the main players of the education loan. To be in competition with PSBs Credila has to cover a wide distance.
In 2009-10 PSBs disbursed educational loans worth Rs 8,000 crore to 320,000 students while there outstanding loans amounted to Rs 35,628.33 crore at the end of March 2010.
He said, “We can access its (HDFC’s) existing customers and database. It will not only help us expand but also bring down the cost of funds.”
The company is also having talks with other banks in order to diversify its sources of funds. PNB is giving credit whereas CARE has assigned a “BBB”-rating for its term loan facility (Rs 100 crore).
Currently Credila is doing 65 per cent of lending, to students studying within the country and the loan is given mainly for management courses in India, in the United States the disbursement is largely for masters in science, followed by management courses.
Bhonsle said, “This is an asset class in India which has not been focused on as a separate venture. While PSBs have been offering student loan services, they have been selling it as part of the product portfolio they offer.”
Giving details on where does Credila stands out vis-à-vis banks; Bhonsle says the loan facilities offered by banks are mostly identical. Moreover banks sanction loans only after a student has attained admission. Whereas, non-banking financial companies based on domain expertise and their understanding of the background, approve loans before admission.
Credila says that it is more rationalized on courses and career prospects for students, due to which it is more flexible. It gives loans against less security (collateral) as compared to big commercial banks. Bhonsle said, “We are flexible. Our domain expertise helps us extend this facility in such a large market of opportunity.”
It also has a different approach. To get loan student has to visit bank branch whereas Credila reaches out to students for loans.
“Students and parents want the kind of help that we are offering –reaching their door steps. If someone comes to them and explains everything, it makes sense. Small things are of large importance,” added Bhonsle.
Credila’s keep its back-end operations updated on education institutes. It has a database of more than 20,000 colleges.
The company is offering loans between interest rates of 9.75 per cent and 12.5 per cent and provides loans up to Rs 50 lakh, while PSBs do not lend more than Rs 20 lakh.
Wednesday, June 2, 2010
HDFC Bank has raised withdrawal limit and shopping limit of all debit cards
At present customers are allowed to withdraw up to Rs50,000 per day on their debit cards from ATM. But HDFC Bank has raised the withdrawal limit and shopping limit of all debit cards, effective June 1.
The ATM withdrawal and shopping limits, respectively, for the Imperia Gold card has been increased to Rs1 lakh and Rs1.25 lakh from Rs50,000 per day; Easy Shop Regular International/Maestro/NRO cards has been increased from Rs25,000 and Rs40,000 from Rs15,000 and 25,000 while on Kid’s Advantage card the limit has been increased to Rs2,500 from Rs1,500 and Rs1,000 and on Women’s card it has been increased up to Rs25,000 from Rs20,000.
However ICICI Bank allows withdrawals up to Rs1 lakh and a transaction limit of Rs1.5 lakh on its Titanium, Platinum and Signature debit cards per day.
While on Gold card the withdrawal as well as transaction limit is up to Rs 50,000.
On Axis Bank’s Gold Card withdrawal limit is up to Rs 50,000, but shopping limit is of Rs1.75 lakh per day.
Withdrawal limits for customers set by the banks are according to Reserve Bank of India guidelines.
A banking analyst with a brokerage firm pointed out, “Withdrawal limits set by banks usually depend on their customer bases and the nature and ticket sizes of the transactions.”
“Few transactions or withdrawals by our customers touch the limit. So, as of now, we haven’t thought of raising those limits,” said SS Ranjan, chief financial officer, State Bank of India (SBI).
Meanwhile, SBI, country’s largest public sector lender has a withdrawal limit of Rs Rs40,000 and transaction limit of Rs50,000 per day.
However cash withdrawals from the ATMs of other banks have not been changed it is still Rs 10,000 per transaction, allowing five such transactions a month.
The ATM withdrawal and shopping limits, respectively, for the Imperia Gold card has been increased to Rs1 lakh and Rs1.25 lakh from Rs50,000 per day; Easy Shop Regular International/Maestro/NRO cards has been increased from Rs25,000 and Rs40,000 from Rs15,000 and 25,000 while on Kid’s Advantage card the limit has been increased to Rs2,500 from Rs1,500 and Rs1,000 and on Women’s card it has been increased up to Rs25,000 from Rs20,000.
However ICICI Bank allows withdrawals up to Rs1 lakh and a transaction limit of Rs1.5 lakh on its Titanium, Platinum and Signature debit cards per day.
While on Gold card the withdrawal as well as transaction limit is up to Rs 50,000.
On Axis Bank’s Gold Card withdrawal limit is up to Rs 50,000, but shopping limit is of Rs1.75 lakh per day.
Withdrawal limits for customers set by the banks are according to Reserve Bank of India guidelines.
A banking analyst with a brokerage firm pointed out, “Withdrawal limits set by banks usually depend on their customer bases and the nature and ticket sizes of the transactions.”
“Few transactions or withdrawals by our customers touch the limit. So, as of now, we haven’t thought of raising those limits,” said SS Ranjan, chief financial officer, State Bank of India (SBI).
Meanwhile, SBI, country’s largest public sector lender has a withdrawal limit of Rs Rs40,000 and transaction limit of Rs50,000 per day.
However cash withdrawals from the ATMs of other banks have not been changed it is still Rs 10,000 per transaction, allowing five such transactions a month.
Friday, May 14, 2010
HDFC follows SBI's suit and extends its teaser home loan scheme
Earlier HDFC Bank following the suit of State Bank of India (SBI) had reintroduced its teaser rate scheme and the last date was April 30. As SBI is getting good response for its teaser home loan scheme so it extended the up till June 30. Although HDFC did not said anything about the extension of the scheme but, now it has also extended its special home loan scheme till June 30.
Under this special scheme, HDFC will offer a fixed rate of 8.25% up to March 2011, 9% for the next one year and floating rate thereafter to all customers who avail at least part of the loan by June 30, an HDFC spokesperson told.
Earlier, when the Reserve Bank’s raised concern over such teaser schemes all banks, except SBI had stopped their teaser schemes or special home loan offers under which they offered loans at a cheaper rate to customers for a fixed period.
As HDFC has announced extension of the scheme it is believed more banks might also announce similar products to attract borrowers.
Under this special scheme, HDFC will offer a fixed rate of 8.25% up to March 2011, 9% for the next one year and floating rate thereafter to all customers who avail at least part of the loan by June 30, an HDFC spokesperson told.
Earlier, when the Reserve Bank’s raised concern over such teaser schemes all banks, except SBI had stopped their teaser schemes or special home loan offers under which they offered loans at a cheaper rate to customers for a fixed period.
As HDFC has announced extension of the scheme it is believed more banks might also announce similar products to attract borrowers.
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