The fixed rate scheme offers two options –

1. Customer can make pre-payments subject to certain conditions
2. Customer chooses not to make pre-payments during the fixed rate period.

The new rate is available for one to five years for home loan and five years for loan against property, with applicable rate beginning at 11.25 % for one-year tenor to 11.75 % for a five-year home loan.

There is 25 BPS discount for every tenor provided the borrower does not choose to pre-pay the loan. Similarly, loan against property, which has a five-year tenor, the rate is 12.5 % and 12.75 % with the pre-paid option.

On the expiry of the fixed rate period, the loan will switch to floating rate at a margin of 2 % for home loans and 3.25 % for loan against property over the prevailing base rate.

"The second option has been specially introduced for customers who are aware that they are not likely to prepay the loan within the term of the fixed rate. In this case, they can avail of a 0.25 percentage points discount from the bank on the fixed rate, thus having the benefit of hedging their interest rate risks over the fixed rate tenure.

The fixed rate product is a characteristic adding to our varied range of product offerings. There are many customers who do not prepay their loans within the first 5 years, and seeing this trend, we have introduced this product wherein they will be able to hedge against interest rate risk on loan payments. These unique features strongly reinforce our understanding of customer benefit."