A recent press report said that State Bank of India has announced that it had no plans to take a cue from rival ICICI Bank and devise a dual rate home loan scheme.
Mr. Pratip Chaudhuri, chairman, SBI, said that the bank has no plans at present to introduce a dual rate home loan.
Reports said that under tighter provisioning norms introduced last November, banks have to set aside higher provisioning for teaser loans. It added saying that SBI had gained grabbed attention and market share in the home loan space on introducing the teaser home loan scheme which offered a low, fixed interest rate at 8 per cent in the initial years of the loan which later morphed into a floating rate at the prevailing market rate.
MR. Chaudri said that SBI’s current home loan product has been widely accepted and the bank had not seen any drop in demand despite higher interest rates. He said the bank was focusing on the introduction of simple products that its customers would easily understand.
He also said that it is easier for the sales force to explain the features, as the bank had come up with a uniform rate for car loans irrespective of the tenor or the amount.