Srei Infrastructure Finance and Srei Equipment Finance, the two financing companies of Srei group have raised their key lending rate by 1% with immediate effect.

The present benchmark lending rates for the companies thus stands at 16% from 15% earlier.

"This increase has been necessitated due to successive increase in the interest rates by the banks in the past few months," Srei Infrastructure Finance Chairman and Managing Director Hemant Kanoria said.

"We usually do not react immediately as it may be detrimental to the interests of our clients. We now clearly see a rising interest rate trend, therefore this hike," he added.

According to him the Asset Liability Management Committee of the companies decided to raise the benchmark lending rates after a meeting held on 5th October 2010 about the current market scenario and trend of rising interest rates to curb the towering inflation figures.