New Delhi, July 15 -- At least four banks have reduced their marginal cost of funding based rates in the past few days. These banks are Canara Bank, HDFC Bank, PNB and Bank of Baroda (BOB).

After the Reserve Bank of India (RBI)cut the repo rate by 50 basis points last month (June 6), most banks followed suit by cutting theirlending rates, albeit marginally. The rate cut in June was the third consecutive cut by the RBI, triggering the onset of rate cut cycle.

Consequently, Canara Bank has now reduced its overnight marginal cost of lending rate (MCLR) by 5 basis points from 8 to 7.95 percent per annum.MCLR is the minimum rate below which banks can not lend to borrowers.

This rate regime had replaced the base rate system in 2016. MCLR is ...