With the kick-start to March 2010, many private banks have decided to hike their home loan and auto loan rates for the new borrowers. India's largest private sector bank, ICICI, for instance has decided to hike its auto loan by almost 25-50 basis points depending on the amount of the deal and tenure of the loan period.

Moreover, the bank has also decided to get over with its 8.25% home loan scheme.

Another banking and home finance major, HDFC bank has also taken a similar decision by withdrawing its 8.25% home loan scheme.

Kotak Mahindra Bank has decided to hike its home loan rates by almost 50 basis points and Kotak Mahindra Prime has also announced a similar hike in the auto loan rates.

Experts believe the hike in the loan rates are because of the improving market condition and the pressure of the increasing cost that the companies took on themselves in February are now just passing it over.

However, as of now the banks not decided to announce a hike in their prime lending rates hence these rates will only be applicable to the new buyers.