New Delhi Apr 19 PTI The countrys largest lender State Bank of India SBI has raised its marginal cost of funds based lending rate MCLR by 10 basis points bps or 01 per cent across all tenures a move that will lead to an increase in EMIs for borrowers The lending rate revision by SBI is likely to be followed by other banks in the days to come With the increase EMIs will go up for those borrowers who have availed loans on MCLR not for those whose loans are linked to other benchmarks SBIs EBLR rate is 665 per cent while the repo-linked lending rate RLLR is 625 effective April 1 Banks add Credit Risk Premium CRP over the EBLR and RLLR while giving any kind of loan including housing and auto loans The revised MCLR rate is effective from April 15 as per the information posted on SBI website With the revision one-year MCLR has increased to 710 per cent from the earlier 7 per cent An overnight one-month and three-month MCLR rose by 10 bps to 675 per cent whereas a six-month MCLR increased to 705 per cent Most of the loans are linked to the one-year MCLR rate At the same time two-year MCLR increased by 01 per cent to 730 per cent while three-year MCLR rose to 740 per cent From October 1 2019 all banks including SBI have to lend only at an interest rate linked to an external benchmark such as RBIs repo rate or Treasury Bill yield As a result monetary policy transmission by banks has gained traction The impact of the introduction of external benchmark-based pricing of loans on monetary transmission has been felt across various sectors encompassing even those sectors that are not directly linked to external benchmark-based loan pricing Looking ahead the proportion of loans linked to external benchmarks is expected to increase further along with a commensurate fall in the internal benchmark linked loans Coupled with shorter reset periods monetary transmission to banks interest rates can thus be expected to strengthen further a recently released article by RBI said PTI DP DRR