State Bank of India (SBI) has cut is benchmark lending rate by 0.05 per cent across maturities, effective from Wednesday, according to an announcement by the state-run lender.

The reduction in marginal cost of funds based lending rate (MCLR) by the largest Indian bank, last made on January 1 this year, has thus brought its MCLR down to 7.95 per cent from 8 per cent, the SBI website said.

The MCLR on overnight borrowings has been reduced to 7.70 per cent from 7.75 per cent, while the rate for three-year tenures has been lowered from 8.15 per cent to 8.10 per cent.

On Tuesday, another public sector lender, the Kolkata-headquartered Allahabad Bank reduced their MCLR rate by 0.15 per cent across maturities. The reduction has brough down the one-year MCLR to 8.30 per cent, as against 8.45 per cent, effective November 1.

At its fourth bi-month monetary policy review here earlier in the month, the Reserve Bank of India kept its key interest rate unchanged at 6 per cent, reiterating its call for better transmission by the banks of earlier rate cuts made by the central bank.