The State Bank of India (SBI), a government-owned lender, has revised its home loan interest rates effective August 1, 2025, as reported by The Economic Times. The upper limit of SBI’s regular home loan interest range has been increased by 25 basis points, now standing at 8.70%, while the lower limit remains at 7.50%. This hike comes despite the Reserve Bank of India (RBI) maintaining its repo rate at 5.55% during the August 2025 policy meeting. SBI clarified that home loan interest rates are based on the borrower’s CIBIL score and linked to the External Benchmark Lending Rate (EBLR), currently at 8.15%.
This rate hike affects borrowers with weaker credit scores who fall into the higher interest bracket, increasing their EMI burden. For instance, a ₹50 lakh loan over 20 years at 8.70% interest would result in a monthly EMI of ₹44,026, compared to ₹43,233 at the previous 8.45% rate. Over the loan period, this results in ₹1.90 lakh more in total payments — a ₹737 monthly increase — making the loan costlier in the long run.