Bankers on Tuesday said interest rates for borrowers, including car and home loan customers, could go up by up to one per cent, following RBI's monetary measures announced to control inflation.

Banks would pass on the additional cost to customers and there is pressure on the lending rates, said Bank of India Chairman and Manging Director T S Narayanswami.

RBI hiked the CRR, the percentage of depositors' money that banks need to keep with the central bank, by 25 basis points that will impound over Rs 8,000 crore from the banking system. Besides, the central bank also raised the repo rate by 50 basis points to 9 per cent resulting in higher cost of borrowing.

According to UCO Bank Chairman S K Goel, "The short term lending rates would go up in between 50-100 basis points." 

Since RBI expects inflation to come down to 7 per cent by March which would lead to softening of the monetary stance. Long term interest rate would remain unchanged, he said.

Hinting at the hike in interest rate, ICICI Bank Joint Managing Director Chanda Kochhar said, "We would see a regime of high interest rates for sometime. If the cost goes up, lending rates would go up but we have to watch how the market reacts."

On the credit growth, she said: "We have seen some impact on the retail credit growth. As far as corporate credit is concerned, the growth would continue."

Taking a cue from policy which predicts GDP growth of 8 per cent during the current fiscal, she said credit can grow at 16-20 per cent. So there would hardly be any impact on the credit growth.