OREANDA-NEWS. November 14, 2012. Bank of Baroda and Punjab National Bank announced a reduction in home loan rates and a waiver in processing fees on retail loans, a move aimed at growing their retail book at a time when there is poor demand for loans from corporates, reports Economic Times.

Both banks said that they would waive off processing fees till November 30. While Bank of Baroda has decided to charge base rate of 10.50% on home loans upto Rs 3 million, Punjab National Bank has decided to charge its base rate of 10.50% for loans upto Rs 7.5 million.

However rates offered by both banks is slightly higher than that offered by country`s largest bank- State Bank of India- which has pegged home loans upto Rs 3 million at 10.25% and above Rs 3 million at 10.40%, the financial daily said.

PNB has said that it would finance entire cost car purchase - upto ex-showroom price - at interest rate ranging from 11.50-12%. This would mean very low margin requirement for the customer.

Meanwhile, Bank of Baroda has said that it would charge 11.25% for car loan upto 5 years and 11.75% for car loans upto 7 years.

Further, to attract their existing customers, Bank of Baroda has also said that existing home loan customers would get a 0.25% discount on car loan.