UCO Bank Home Loan Interest Rates
Interest Rate

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Loan Tenure

- years

Lowest EMI Per Lakh

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Prepayment Charges

Nil charges for floating rates loans

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About UCO Bank

The seed of the formation of a genuinely Indian bank was sown during the historic Quit India Movement in 1942. The noted industrialist G D Birla conceived the idea of opening a bank to cater to the clientele of free India. United Commercial Bank was thus, established on January 6, 1943, with its Head Office at Kolkata. The bank was unique in the sense that all its employees and directors were Indians. The bank has maintained the tradition even today in all its 3000+ service units in India and overseas centres like Singapore and Hong Kong.

United Commercial Bank was nationalised with 13 other banks in July 1969. The year 1985 proved to be a turning point in the history of United Commercial Bank, as it changed its name to UCO Bank through an Act passed in the Parliament. Though UCO Bank has branches spread all over the country, it remains an East-dominated bank. This reason prompted the Government not to include UCO Bank in the recent bank merger list. It retains its Eastern flavour, thereby continuing to function as UCO Bank.

UCO Bank Services on Offer

UCO Bank offers a bouquet of deposit and loan products while catering to every sector of Indian society. Its Personal Banking module takes care of the retail business that includes Home Loans as one of the most popular products. The bank offers Corporate Banking services and MSME/Business banking to cater to the business segments. Similarly, the bank has a Rural Banking section to provide banking services to the agricultural sector. It serves the international community, as well through its representative offices in Singapore and Hong Kong.

UCO Bank Home Loans

Housing and shelter are prime necessities in life. UCO Bank realises this fact as it offers a variety of Home Loan products to suit the requirements of every individual. UCO Bank has Home Loan products to finance new houses and flats. The bank grants loans for purchasing second-hand dwellings, as well. The bank has exclusive loan products for constructing houses. It also provides financial assistance for home improvement, repairs/renovations, and extensions. Balance transfer facility is also available. UCO Bank has a dominant presence in the Eastern part of our country. Hence, it uses its tremendous reach in these areas to popularise PMAY and help the Government of India realise its vision of ensuring a home for every Indian by 2022.

The USP of UCO Bank Home Loans is its competitive pricing of Home Loans with attractive rates of interest. The bank ensures that its clientele reaps the real benefits of market rates by linking its Home Loan rates to market-related rates. This factor plays a vital role in realising the bank's endeavour to serve their customers better.

UCO Bank Home Loan Interest Rates

Repo Rate Linked Lending Rates - RLLR

UCO Bank strictly follows the directives of Reserve Bank of India (RBI) by linking its retail advances to an external benchmark rate like the Repo Rate. UCO Bank has launched a new Home Loan product where it offers RLLR-linked interest rates to its new customers. Existing customers will also get an option to switch over to the RLLR concept in due course. The bank has gone a step ahead by linking its High-Value savings deposits with the repo rate.

The repo rate is an accurate indication of the market rate. This rate provides the direction for other market-linked rates to follow. RBI has recently brought down the repo rate from 5.75% to 5.40% and urged all banks to link their interest rates to this external benchmark. It ensures that the benefit of market rate fluctuations reaches the ultimate customer.

The formula for calculating RLLR is easy. It comprises of three factors:

  • The repo rates announced by RBI from time to time
  • The average net interest margin of the bank for the last ten years
  • The credit history or credit rating of the borrower

Thus, the RLLR concept is better than the existing MCLR because it connects with the market-linked rates and the overall performance of the bank. UCO Bank has adapted to RLLR with effect from September 01, 2019.

Marginal Cost of Funds-based Lending Rate - MCLR

With effect from April 01, 2016, all banks in India follow the MCLR concept while deciding on the rate of interest on their advances. UCO Bank follows the same methodology. The MCLR indirectly connects with the market rate.

The aspects that go into deciding the MCLR of the bank are as follows:

  • Marginal Cost of Funds: The marginal cost of funds is a vital aspect. It comprises of two factors, the marginal cost of borrowing (92%) and the return on net worth (8%). Hence it is a complex calculation that involves the bank to perform well and have a healthy capital structure, as well.
  • Tenor Premium: This factor is common to all loans, as it is not borrower or loan-specific.
  • Operating Cost: It includes all the costs that banks incur for mobilising the funds required to lend. However, it excludes those costs that are recoverable from the customer like processing fees.
  • Negative carry on account of CRR: This factor comes into play when the returns on CRR are less than the cost of funds for the bank.

The MCLR concept is a market rate-linked concept, but the benefits of rate fluctuations reach the customer late. It prompted RBI to intervene and direct banks to adopt a straightforward external benchmark rate to pass on the benefits to the customer. The RLLR concept is a result of such a directive. All banks must switch to the RLLR concept by October 01, 2019.

Base Rate

Before April 2016, banks followed the Base Rate concept. This concept was also a market rate-linked concept in many ways. The Base Rate concept was in force from July 01, 2010.

Benchmark Prime Lending Rate - BPLR

Before the introduction of the Base Rate concept, banks had a BPLR structure in place. Even today, banks have some loans in the BPLR structure. Therefore, every bank, including UCO Bank announces its BPLR and BR at protracted intervals.

UCO Bank Home Loan Interest Structure

  • The BPLR of UCO Bank with effect from October 05, 2015, is 14.25%
  • The Base Rate of UCO Bank with effect from September 10, 2017, is 9.60%
  • The MCLR with effect from September 10, 2019, is as follows:
Tenor Overnight One-month Three-month Six-month One year







The Home Loan interest structure based on MCLR with effect from September 10, 2019, is as follows.

Home Loan Category/Amount slab wise Rate of Interest The effective rate of interest

Home Loan up to 30 Lakhs



Home Loans more than 30 Lakhs and up to 75 Lakhs

MCLR-1Y + 0.10%


Home Loans above 75 Lakhs

MCLR-1Y + 0.25%


UCO Corporate Home Loan for Corporate having internal rating UCO 3 and above

MCLR-1Y + 2.15%


UCO Corporate Home Loan - Others

MCLR-1Y + 3.15%


UCO Top Up Home Loan

MCLR-1Y + 1.40%


  • UCO Bank Home Loan structure based on RLLR with effect from September 01, 2019 is as follows. It is known as UCO Float Rate
Home Loan Slab based on CIBIL credit score UCO Float Rate Risk Premium The effective rate of interest

CIBIL or its equivalent - 750 and above




CIBIL or its equivalent - Below 750




UCO Bank Home Loan Interest Rate - Points to Note

  • UCO Bank Home Loan interest rates link to the one-year MCLR of the bank. It is a floating rate of interest. Any increase or decrease in this rate will affect the Home Loan interest rate.
  • The RLLR Home Loan interest rate is available for new customers. However, the bank will allow existing customers to switch over to the RLLR in due course.
  • Customers who are under the BR and BPLR regime will continue to remain there unless they request the bank to switch over to MCLR or RLLR. The reverse switching is not possible.
  • The RLLR depends on the CIBIL rating of the customer
  • RLLR is also a floating rate depending on the repo rates announced by RBI
  • The rates of interest applicable to PMAY borrowers are the same as that of general borrowers

UCO Bank Home Loan Interest - Method of Interest Calculation

Like all other banks, UCO Bank calculates Home Loan interest on daily reducing balances. Hence, EMI is the ideal option for repayment.

How to Determine UCO Bank Home Loan EMI

UCO Bank does not have an EMI calculation chart on its web page. Hence, customers can access the EMI Calculator available on MyMoneyMantra to determine their EMI.

  • Access the MyMoneyMantra website and select the Financial Tools option
  • Choose the EMI Calculator
  • Enter the necessary data, such as the loan amount, the rate of interest, and Home Loan repayment tenure.
  • The EMI is available instantly along with the break-up of principal and interest repayment throughout the loan tenure.

How to Determine PMAY Home Loan EMI

PMAY loans need a different approach to calculate the EMI because of the upfront subsidy factor. Each PMAY beneficiary is eligible for a subsidy/grant from the Government of India. The subsidy amount depends on the category to which the borrower belongs and the loan amount.

Category of borrowers Annual family income ceiling The eligible loan amount for calculation of subsidy Subsidy Rate Maximum grant

Economically Weaker Sections - EWS

3 Lakhs

6 Lakhs


2.67 Lakhs

Low Income Group - LIG

6 Lakhs

6 Lakhs


2.67 Lakhs

Middle-Income Group-I - MIG-I

12 Lakhs

9 Lakhs


2.35 Lakhs

Middle-Income Group-II - MIG-II

18 Lakhs

12 Lakhs


2.30 Lakhs

  • Determine the subsidy amount using the PMAY subsidy calculator available on the PMAY website.
  • Deduct the available subsidy from the principal loan amount because of the upfront credit facility available in PMAY accounts.
  • Use the reduced principal amount as the base for calculating the EMI

UCO Bank Home Loan Interest - Frequently Asked Questions

Is UCO Bank's RLLR available to existing Home Loan customers?

Initially, UCO Bank has introduced the RLLR to facilitate new customers. It will give an option to existing customers to shift over to the RLLR from the existing MCLR regime.

Will the RLLR be beneficial to the customers?

It is too early to comment on whether RLLR will be beneficial or not. As on date, the repo rate is 5.40%. Hence, UCO bank RLLR-linked Home Loan interest rate is around 8.30%. If the repo rate increases, the RLLR will also increase. Therefore, one must wait and study the trends.

Will the repo rate affect the MCLR?

MCLR is also a market-related rate structure. The repo rate is the driving force behind all the market rates. Hence, a change in the repo rate will bring a corresponding change in the MCLR, as well.

How does repo rate affect the EMI?

A change in the repo rate will induce a change in the Home Loan interest rate. Ideally, the EMI should also move in the same direction as the rates do. However, banks prefer to maintain the EMI constant while varying the loan tenure. Therefore, one can expect the mandate to change with a change in the MCLR.

Will these rate changes affect the base rate and BPLR?

It should not affect the base rate and BPLR because these rates are already very high. If the MCLR and RLLR reach the level of the Base Rate, the bank could consider altering the Base Rate structure.

Is the repo rate linked interest rate applicable to deposits?

Ideally, the repo rate should affect the deposits, as well. However, banks in India do not link the deposits to a floating rate structure. UCO Bank has recently announced the linking of savings deposits rate on interest with the repo rates. Savings bank deposits of 25 Lakhs and more attract a higher rate of 3.50% as against 3.35% for the regular savings deposits.

Can a borrower in the Base rate or BPLR regime change over to the MCLR concept?

UCO Bank allows borrowers in the Base rate or BPLR interest regimes to switch over to the floating rate MCLR structure on the payment of a conversion fee. However, the reverse switch over is not permissible.

Does UCO Bank have a preferential rate of interest for selective borrowers?

UCO Bank Home Loan interest rates in the MCLR structure depends on the loan amount. The interest rate on the Home Loans in the RLLR concept depends on the CIBIL score of the borrower. Borrowers with a higher CIBIL score (more than 750) get a benefit under RLLR>

How does the upfront interest subsidy affect the EMI in PMAY accounts?

On crediting the upfront subsidy to the loan account, the principal amount reduces accordingly. The EMI is calculated on the reduced principal amount, thereby benefiting the borrower.

Is the floating rate structure better than the fixed rate of interest?

Housing finance is a priority sector finance in India. Hence, the Government controls the rates of interest indirectly. Therefore, it is beneficial to opt for a floating rate of interest on Home Loans. The fixed rate of interest on loans is comparatively high.

UCO Bank Home Loan Interest - Latest news

UCO Bank declares Yashovardhan Birla as a wilful defaulter

UCO Bank has declared Yashovardhan Birla as a wilful defaulter for non-payment of 67.55 crores given to Birla Surya Ltd. Ironically, an ancestor of Yashovardhan Birla was among the frontrunners in establishing UCO Bank in the 1940s.

UCO Bank slashes its MCLR across all tenors

Close on the heels of the RBI announcement to cut repo rates to 5.40%, UCO Bank has cut its MCLR across all tenors by 15 basis points. There is a further cut of 5 basis points across all tenors in September. Thus, its latest MCLR-1Y becomes 8.45%.

UCO Bank approaches LIC of India for a capital infusion

LIC of India is one of the significant investors in UCO Bank. As UCO Bank is looking to raise its capital by around 5,000 Crores this fiscal, it has approached LIC of India for a capital infusion over 1,000 Crores.

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