Interest Rates Policy

1. Preamble & Objectives

This Interest Rate Policy framework is formulated in accordance with Chapter V of the RBI Master Directions on Scale Based Regulation and the Fair Practices Code and specific contents of the NBFC – Base Layer (Scale-Based Regulation)

RBI has vide its Master Direction – RBI (NBFC Scale Based Regulation) Directions, 2023 & the RBI (NBFC – Responsible Business Conduct) Directions, 2025 (with 2026 amendments) direct the NBFCs to have a documented Interest Rate Model Policy approved by the Board of Directors which would lay down internal principles and procedures in determining interest rates and other charges on the loan products offered.

The specific points referred to in the above referred RBI circular are,

a) The need for the adoption of an interest rate model calibrated to the risk associated with the loan product offered.

b) Charging of exorbitant interest rates by NBFCs.

c) Disclosure of rates of interest charged.

d) Adopting annualized rates of interest for loans offered to customers.

Based on the above tenets, the Board through its internal review has laid out and adopted the range of interest rates that shall be applicable to the loan products, based on the risks associated with each product and has created its “Interest Rate Policy” (Version 2.0). The Company shall endeavour to apply best industry practices without conflicting with and violating the RBI guidelines.

The primary objectives of the policy thus, are to:

1. Establishing a mathematically sound internal Interest Rate Model: The model defines the basis on which the interest rate range shall be arrived at for various loan products. The model takes into consideration the various elements and operational expenses along with a fair and equitable premium the business would expect for the loan product under consideration. The following items shall form a part of the Interest rate model –

Weighted Average Cost of borrowing – The Company shall use the equity raised from its shareholders for onward lending to its customers. Further, it would leverage its net worth suitably and as part of its business will borrow funds from various Banks / Financial Institution for the purpose of lending. The weighted average cost of borrowing (both current and near-future outlook) would be considered as the starting point in determination of pegging order.

Operational Expenses –In addition to the Weighted Average cost of borrowing, the company would incur certain expenses towards infrastructure, technology, collection, human resources, Professional fees, and other related expenses to maintain and generate business. These are Operational expenses incurred for business continuity.

Profit Margin: The operating expenses and target returns of the Company in terms of both acquisition leg and that of collections and portfolio maintenance considering the target segment, risks attributed, primary collection efficacy and secondary collection efficiency (with costs associated), regulatory constraints in terms of marking the asset as “Non-Performing Asset” etc., .

Provisioning for Losses / NPA – The company in its ordinary course of business shall incur certain costs on account of losses arising from NPA customers. This inter alia includes the provisioning required to be made for standard assets. This is classified as the cost of credit.

These aforementioned costs are jointly referred to as ‘Base Rate’ and a ‘Risk Premium’ (Extra charges applied depending on the borrower’s credit profile and the probability of default) is added to arrive at the appropriate rate to be charged to the customer. The Risk Premium charged would largely depend on the Loan product offered.

Loan Products:

The Company currently offers 3 loan products each targeting different segment of customers:

• Business Loans ranging from INR 50,000 – INR 10,00,000 for tenors ranging from 6 to 24 months. This product facilitates loans forLow Income Group segment of customers who would seek short-term loans for a variety of reasons and those shopkeepers from Medium Income Group. These loans are extended as unsecured loans without any security and extended with Equated Daily Instalment or Equated Weekly Repayment Options. EMI option is given for certain specific business segments only. The underwriting policy ensures to weed out negative profiles and negative areas/ geographical pockets which pose credit and collection risks.
• Term loans basis GST turnover and traction – ranging from INR 5,00,000 to INR 30,00,000 for tenor ranging from 12 to 36 months. The minimum annual turnover criteria of INR 1 Crore are insisted upon and these loans are extended as unsecured loans and are extended with monthly repayment option. Minimum business stability of 2 years and mandatory matching of input and output services are checked to corroborate business turnover claims and impeccable banking history with minimum ABB of INR 75,000 is sought.
• Top-up loans to borrowers who have successfully repaid their loan in the past – for existing customers with excellent repayment track record, top-up loans are being offered. The eligibility threshold starts for all borrowers who have repaid minimum 70% of the existing loan dues (with a maximum/ peak DPD of 10 days) and these loans are offered for tenors up to 24 months. The loan amounts range from INR 25,000 – INR 30,00,000. These loans are extended as unsecured loans without any security and extended with Equated Daily Instalment or Equated Weekly Repayment Options. EMI option is given for top-up on GST loans only. These loans are extended beyond system eligibility determination, with fresh assessment of current trend of UPI credit inflows, bank statement, field investigation, bureau checks etc. basis risk matrix recommended ROI.

2. Standardizing a Risk Gradation Matrix to eliminate arbitrary loan pricing. In terms of creating and maintaining Risk Gradation Matrix, the Company should consider a gradation model with total transparency and objective modelling basis portfolio expectancy factors. This in turn depends on:

• Risk-Based Pricing: Different borrowers who can be charged varying rates based on their respective risk profile and risk grading, and the said rationale duly documented and structurally sound/ logical and tested for objectivity.
• Annualized Rates: All interest rates must be quoted as annualized rates (e.g., APR) so the borrower understands the exact yearly cost of the loan and makes a conscious decision to avail the loan consciously. The APR shall be derived from the Company’s internal cost-plus interest rate model; interest rates charged by market peers may be used only as a reference point for a reasonableness check, and shall not by themselves determine the rate charged to any borrower.

3. Enforcing absolute transparency via standardized customer disclosure rules. For ensuring ultimate governance hygiene and transparency in its operations, the Company must ensure to publish its interest rates and risk-gradation approach on its official website and also update it immediately whenever the interest rates are poised for revision/ change. Also the Company needs to have a properly updated and reviewed Fair Practices Code (duly hosted).

4. Ensuring objectivity in interest pricing mechanisms.

2. Governance Framework & Oversight

The Board of Directors consider and approve the policy, clearly giving directions, defining maximum rate caps, and auditing compliance performance on a continuous and consistent basis. The Board holds the power to perform the assessment of Asset-Liability matching and pricing the fresh acquisition book for the next quarter. The Board would meet every quarter, to review market conditions, cost of capital shifts, and yield ranges and decides on changes and rejigs to the interest policy of the Company etc. and is responsible for evaluating credit risk premiums and maintaining internal data validation integrity (wherein the key stakeholder is the Head of Credit & Risk) and would internally publish the Rate Matrix and deviation thresholds (if any) with attendant approval matrix.

3. The Core Interest Rate Model

The annualized lending rate charged to any given borrower shall be calculated using a bottom-up, multi-component method and considering basic cost of funds, various Operating costs/ OPEX loading, Risk premium representing Credit and Tenor risks and targeted Profit margin.

Interest rates shall generally be determined after considering the following components:

1 Cost of Funds

Weighted average cost of borrowings from banks, financial institutions, co-lending partners, debt instruments, internal accruals, equity capital and other approved funding sources, together with liquidity management and treasury costs.

2 Operating Cost

Expenses relating to customer acquisition, underwriting, credit appraisal, KYC verification, branch operations, technology infrastructure, employee costs, collections, customer servicing, legal, compliance and administrative overheads.

3 Risk Premium

Compensation for borrower-specific, product-specific and portfolio risks, including credit risk, fraud risk, operational risk, collection risk and market risk

4 Credit Cost/Expected Credit Loss (ECL)

Expected defaults, provisioning requirements, historical portfolio performance, collection efficiency and recovery experience.

5 Technology & Digital Infrastructure Cost

Loan Management System (LMS), Digital Lending Platform, cybersecurity, API integrations, fraud detection, alternate data analytics and digital servicing costs.

6 Liquidity & ALM Cost

Liquidity buffers, funding mismatches, treasury management and asset-liability management

requirements.

7 Regulatory & Compliance Cost

Compliance with RBI Directions, statutory reporting, audit, governance, customer protection and information security obligations.

8 Business Margin/Return on Assets (ROA)

Reasonable commercial return necessary for sustainable business operations, capital adequacy and future growth.

4. Risk Gradation Matrix

The company will deploy risk-based pricing considering:

Graded risk approach to determine applicable ROI and APR

Risk grading enables the Company to differentiate customers across the different risk spectrums and helps in applying appropriate APR to that customer. The following factors are considered while determining the APR applicable to a particular customer:

1. Weighted Average Cost of Funds;

2. Profile and market reputation of the borrower,

3. Nature of Business and Industry Segment;

4. Internal Credit Risk Rating;

5. Credit Bureau Score and Credit History;

6. Past repayment track history

7. Income proof which in turn would determine the ability to repay

8. Business Vintage;

9. Business Cash Flows claimed and assessed Repayment Capacity;

10. Existing Borrowings and Customer Indebtedness;

11. Previous Repayment Behaviour with the Company and other lenders;

12. Inherent nature of the product and Lending-Collection Model;

13. Loan Amount (Ticket Size);

14. Loan Tenure;

15. End use for which the Loan is borrowed

16. Geographic Location and Collection Performance;

17. Portfolio Delinquency Trends;

18. Lending Channel (Direct Lending, Digital Lending, Business Correspondent (BC), Lending Service Provider (LSP), Co-lending or other approved models);

19. Digital underwriting outputs and alternate data analytics, where applicable;

20. Prevailing market conditions and competitive pricing;

21. Regulatory stipulations

22. Any other objective commercial or risk parameter considered relevant by the Company.

The interest rate applicable to the same loan product, loan tenure or borrower segment may differ between borrowers depending upon their respective creditworthiness, repayment capacity, business profile, product characteristics, lending channel, internal credit assessment and other objective commercial considerations.

Accordingly, borrowers availing similar loan products during the same period may be offered different interest rates, provided such variation is based on documented, objective and non-discriminatory criteria under the Company’s Risk-Based Pricing Framework.

Credit Norms used (in general):

The Credit team while doing assessment considers:

• only positive business profiles and weeds out negative profile businesses
• minimum stability of 2 years in the same place and minimum 3 years in the same line of business; similarly looks for residence stability of minimum 1-2 years
• entry age of the applicant at minimum of 23 years and maximum 60 years
• credit score of 550+
• Loan values from INR 50,000 to INR 30,00,000 depending on various credit and risk parameters configured in the system and in the credit policy
• the UPI credits flowing thru’ the applicant’s bank account(s) with minimum of INR 1000 per day
• that UPI is registered in the name of the Owner applicant (proprietorship) and does not consider partnership firms, OPCs, private limited companies etc.
• shops under franchise set-up basis the Franchise agreement, billing and commission terms etc.
• Daily instalment to be at maximum of 1/3^rd of the average daily UPI inflow credits and an average bank balance equivalent to the daily instalment proposed
• shops with proper set-up including valid name board, relevant and valid registration (as may be applicable for the line of business being carried out), MSME Udyam registration where applicable
• business turnover as declared by the applicant vs. UPI credits actually received in the tagged bank account vs. Sales Officer’s assessment vs. Field Verification Agent’s assessment
• In terms of obligations, the rent for the Shop/ business premises, cost of electricity and other utilities, staff salary etc. and an average margin on sale (basis business profile-wise internal norms)
• An application only if there are no overdue in any of the loans being serviced as per the Credit Information Report and there are no write offs in the last 3 years in any of the loans or the credit facilities availed in the direct name or in the guarantor capacity
• inclusion of co-applicant basis loan quantum sought or as a risk mitigant
• systemic checks including Latitude and Longitude matching address as declared
• checks done with the family (on awareness about the loan), neighbour and reference checks done
• collection team feedback
• his own assessment basis Telephonic personal discussions held and the live video taken covering the entire shop/ business premises covering from shutter gate/ door to interiors, stock holding area etc.

These norms are purely indicative and representative of Company’s credit policy and are more specifically governed by detailed/ extant Credit & Risk Policy guidelines.

The automated ROI pricing matrix considers in addition to the basic Credit Score of the Applicant and Co-applicant, their repayment loan track with the Company, history of maximum DPD strings, settlements and write-offs, build-up of credit card limits and rollovers, bounces in the bank account, trend of UPI credit inflows in the bank account, average bank balance in the main operating account, score for applicant age, application business profile, longevity and stability score for business and residence, own or rented house, loan quantum sought etc. and recommends the ROI applicable for the loan sought. The other components of the APR i.e. loan processing fees, documentation charges and field verification charges etc. are normally recovered as a % of the loan disbursed (along with applicable GST levy thereon) and charged at standard % levels.

The Company’s ROI Matrix system generates appropriate ROI that could be offered to the applicant and deviations sought for lower ROI would be as per the approved Credit Policy of the Company and are duly signed off by the Business, Credit and Risk Teams. No deviation above the Board-approved maximum rate cap for the product shall be permitted under any circumstances.

ROI Determination:

In addition to initial determination of applicable ROI per product, per risk band, the system would consider multiple push-up (increase in recommended ROI) and pull-down (decrease in recommended ROI) such as:

Own house, quantum finance beyond threshold, loans supported by co-applicant, CMR commercial ranking scores for GST-loans, instalment frequency etc. to arrive at final applicable ROI per loan. Also the policy provides for a recommendation leeway to the Business Team to recommend a lower ROI, to manage market competition and customer negotiation/ expectation etc.

Schedule of Interest Rates and Charges (Unsecured Business Loans):

Note: The standard instalment type may be modified subject to approval from the Credit Head.

Repayment Structure:

Recognising the diverse financing needs of borrowers and the varying nature of its loan products, the Company may structure loan repayments based on the borrower’s repayment capacity, business cash

flows, product characteristics, credit assessment and internal approval.

Depending upon the product and approved credit terms, repayment may be structured through one or more of the following modes:

• Equated Daily Instalments (EDI);
• Equated Weekly Instalments (EWI);
• Equated Monthly Instalments (EMI);

Any other repayment frequency approved by the Company in accordance with its Credit Policy and applicable regulatory requirements.

The repayment frequency, number of instalments, instalment amount, due dates and loan tenure shall be determined during the credit appraisal process after considering the borrower’s repayment capability, business cash flow cycle, product features and internal credit assessment The finalized repayment schedule shall be clearly disclosed in the Key Fact Statement (KFS), Sanction Letter, Loan Agreement and Repayment Schedule provided to the borrower before disbursement.

Fees, Charges and taxes applicable:

All applicable fees and charges shall be clearly disclosed to the borrower through the Key Fact Statement (KFS), Sanction Letter, Loan Agreement, repayment schedule, digital interface (where applicable), and such other documents as may be prescribed by the Reserve Bank of India, before execution of the loan documents and prior to loan disbursement.

The Company shall not levy any hidden, undisclosed or unauthorized charges. No employee, Business Correspondent (BC), Lending Service Provider (LSP), recovery agent or any other person acting on behalf of the Company shall collect any amount from the borrower other than the charges expressly disclosed and authorized by the Company.

The Company may, at its sole discretion, waive, reduce, defer or not levy any fee or charge for specific customer categories, promotional campaigns, government-supported schemes, regulatory directions, business exigencies or special programmes approved by the competent authority. Such waiver or concession shall not create any right or legitimate expectation in favour of any borrower for similar treatment in future.

Waiver and Refund of Charges:

Any request for refund, waiver or reversal of fees, charges, penal charges or any other amount collected by the Company shall be examined on a case-to-case basis. The grant of any refund or waiver shall be entirely at the sole discretion of the Company, subject to applicable laws, regulatory directions, contractual obligations and internal policies. No borrower shall acquire any right to claim refund or waiver merely because such concession has been granted in any other case or under any promotional or special scheme.

5. Regulatory Strictures & Penalty Rules

In strict compliance with current consumer protection and fair lending regulations, the Company ensures that:

• Reducing Balance Calculation: All interest is computed exclusively via the daily/weekly/monthly reducing balance methodology.
• Characterization of Default Fees: For all delayed or overdue payments “Penal Charges” are only attracted instead of an escalation in the regular “Penal Interest Rate”.
• No Capitalization of Penalties: the penal charges is computed as a fixed standard percentage applied solely to the overdue installment portion (if any) and the same is not compounded Penal charges shall be reasonable and commensurate with the non-compliance, shall be disclosed upfront in the Key Fact Statement and the loan agreement, and shall be applied without discrimination within the same loan/ product category, in accordance with RBI’s directions on penal charges in loan accounts.

Penal Charges:

The Company may levy penal charges for non-compliance by the borrower with the material terms and conditions of the loan agreement, sanction letter or other contractual documents.

Penal charges shall be levied strictly in accordance with the RBI (Non-Banking Financial Company –

Responsible Business Conduct) Directions, 2025, as amended from time to time.

Accordingly:

• Penal charges shall be levied only for non-compliance with material terms and conditions of the loan contract.
• Penal charges shall be treated as separate charges and shall not constitute penal interest.
• Penal charges shall not be capitalized, and no further interest shall be charged or computed on such penal charges.
• The amount, basis and reason for levy of penal charges shall be clearly disclosed to the borrower before execution of the loan documents through the Key Fact Statement (KFS), Sanction Letter, Loan Agreement and other applicable disclosures.
• The schedule of penal charges shall also be published on the Company’s official website, wherever required under applicable RBI directions.
• Any revision in penal charges shall be implemented only on a prospective basis, and the affected borrowers shall be informed through appropriate communication channels in accordance with applicable regulatory requirements.
• The Company shall ensure that penal charges remain reasonable, proportionate and non- discriminatory, having regard to the nature and gravity of the default or non-compliance.

Prepayment and Foreclosure Charges:

The Company may permit borrowers to prepay or foreclose their loans, either in full or in part, in accordance with the terms of the applicable loan agreement, the sanctioned product features and the prevailing regulatory framework.

Prepayment or foreclosure charges, wherever applicable, shall be determined in accordance with:

the RBI (Non-Banking Financial Company – Responsible Business Conduct) Directions, 2025, as amended from time to time; other applicable RBI circulars and regulatory instructions; the terms of the sanctioned loan product; and the Company’s approved internal policies.

The applicable prepayment or foreclosure charges, if any, shall be: fair, reasonable and transparent; clearly disclosed in the Key Fact Statement (KFS), Sanction Letter and Loan Agreement before execution of the loan documents; communicated to the borrower before acceptance of the loan; levied only in accordance with applicable regulatory requirements and contractual terms; and implemented prospectively. No prepayment or foreclosure charges shall be levied where prohibited under applicable RBI directions or where the prepayment or foreclosure is initiated by the Company. The Company may, at its sole discretion, waive or reduce prepayment or foreclosure charges for specific products, customer segments, settlement programmes, promotional campaigns or other circumstances approved by the competent authority, provided such waiver is consistent with applicable regulatory requirements.

6. Standard Transparency & Client Disclosures

To protect under-banked customer demographics, the Company will:

• The Key Facts Statement (KFS): Send to every borrower an explicit, detailed KFS detailing the Annualized Percentage Rate (APR), processing fees, and full amortization calendar prior to contract execution.
• The Company shall provide a KFS to all prospective borrowers to help them take an informed view before executing the loan contract, as per the standardised format given in the Annex A.
• The KFS shall also include a computation sheet of annual percentage rate (APR), and the amortisation schedule of the loan over the loan tenor. APR will include all charges which are levied by the Company. Illustrative example of calculation of APR for a hypothetical loan is given in Annex B.
• Dual-Language Issuance: share the Loan agreements and the KFS in both English and in the predominant regional vernacular
• Public Domain Accessibility: put up its complete, board-approved Interest Rate Policy duly hosted on its public website.
• shall follow the guidelines mentioned in the Fair Practice Code guidelines as issued by RBI from time to time.
• shall transparently intimate to the borrower, the Annual Percentage Rate charged at the time of loan sanction/documentation along with the tenure for which the loan is offered and the resultant installment amount
• shall inform customers of the APR charged on the Loan availed; shall disclose the rate of interest, the approach for gradation of risk and the rationale for charging different rates of interest to different categories of borrowers in the loan application form and communicate the same explicitly in the sanction letter
• will inform all its customers that for understanding the prevailing Interest Rate Policy of the Company, he can choose to visit the Company’s website (any time) which will have the policy updated from time to time.
• Key Management Personnel of the Company would review the APR charged for the Loan Product from time to time and would suitably bring changes to the rates if required

Public Disclosure of the Interest Rate Policy:

In accordance with the applicable directions issued by the Reserve Bank of India, the Company shall publish this Interest Rate Policy, or such summary thereof as may be required, on its official website.

The Company shall also make available on its website, wherever applicable:

• the Company’s approach to risk-based pricing;
• the methodology for determination of interest rates;
• the broad factors considered for risk gradation;
• the schedule of applicable fees and charges;
• the schedule of penal charges;
• customer disclosure requirements;
• grievance redressal mechanism; and
• such other information as may be prescribed under applicable RBI Directions.

Revision and Communication of Changes:

Any revision to the Interest Rate Policy, pricing methodology, interest rates, fees, charges or penal charges shall be implemented prospectively, unless otherwise required under applicable law or regulatory directions. Where such revisions materially affect existing borrowers, the Company shall communicate the revised terms through appropriate communication channels, including SMS, email, mobile application notifications, website updates, customer portal or any other mode recognized under applicable law and the loan agreement. The latest version of the Interest Rate Policy and the applicable schedule of charges shall always be available on the Company’s official website for the information of customers and other stakeholders.

Confidentiality and Intellectual Property:

This Interest Rate Policy is the intellectual property of Sampathi Credits Private Limited and has been approved by the Board of Directors for the purpose of establishing the Company’s internal governance framework relating to interest rate determination and pricing. Except to the extent required for regulatory disclosure, statutory compliance or publication on the Company’s official website in accordance with applicable laws and Reserve Bank of India directions, this Policy shall not be reproduced, copied, modified, distributed, transmitted, published or disclosed, in whole or in part, without the prior written approval of the Company.

7. Board Oversight & Policy review

The Board of Directors of Sampathi Credits Private Limited ("the Company") shall have the overall responsibility for approving, overseeing and periodically reviewing this Interest Rate Policy to ensure that it remains consistent with the Company’s business objectives, risk management framework, Fair Practices Code, and the applicable directions, circulars and guidelines issued by the Reserve Bank of India. The Board may delegate the operational implementation, monitoring and administration of this Policy to any committee or officials as may be authorized from time to time. However, the overall responsibility for governance of the Policy shall continue to vest with the Board of Directors.

The Board shall, inter alia:

• Approve the Interest Rate Policy and any amendments thereto;
• Oversee the Company’s risk-based pricing framework and interest rate methodology;
• Review reports relating to pricing governance, portfolio performance and regulatory
• compliance;
• Ensure that the Company’s pricing practices remain fair, transparent, customer-centric and non-discriminatory;
• Oversee compliance with applicable RBI directions relating to interest rates, Annual Percentage Rate (APR), Key Fact Statement (KFS), customer disclosures, penal charges and responsible lending practices; and
• Provide strategic guidance on pricing, customer protection and governance matters.

Policy Review Frequency:

This Policy shall be reviewed at least once in every financial year, or earlier whenever considered necessary due to:

• Amendments to applicable laws or regulations;
• Issuance or modification of RBI Directions, circulars or guidelines;
• Changes in the Company’s business model, lending products or delivery channels;
• Introduction of new products, including Digital Lending, Business Correspondent (BC), Lending Service Provider (LSP) or Co-lending arrangements;
• Significant changes in the Company’s cost of funds, risk profile or pricing methodology;
• Material changes in market conditions or macroeconomic environment;
• Observations arising from internal audit, statutory audit, regulatory inspections or compliance
• reviews; or
• Any other circumstances considered appropriate by the Board of Directors.
• Any amendment, modification or revision to this Policy shall become effective only upon approval by the Board of Directors or such authority as may be duly authorized by the Board, in accordance with applicable laws and regulatory requirements.

This structural policy framework remains valid for 12 months from the date of board ratification. The Board shall in discussion with the recommendations of Head-Business and Head-Credit & Risk shall consider any interim amendments to the policy. Board, may suo moto, decide to make changes to the Interest Rate Policy/ norms etc. if there arise exceptional liquidity adjustments in the market or there are systemic RBI directives which have occurred mid-cycle.

The Company further would arrange to promptly host the Interest Rate Policy as reviewed and revised on the Company’s website.

Confidentiality and Controlled Distribution:

This Interest Rate Policy is a controlled corporate document and forms part of the internal governance framework of Sampathi Credits Private Limited. The contents of this Policy shall be used only for legitimate business, governance, compliance and regulatory purposes.

Except to the extent required under applicable laws, regulatory directions or judicial orders, no part of this Policy may be reproduced, copied, modified, distributed, transmitted, published or disclosed, in whole or in part, in any form or by any means, including electronic, mechanical, photocopying, recording, scanning or information storage and retrieval systems, without the prior written approval of the Company.

Nothing contained in this clause shall restrict the Company’s obligation to disclose this Policy or any part thereof to the Reserve Bank of India, statutory or regulatory authorities, auditors, courts, tribunals, or any other authority having lawful jurisdiction, or to publish such portions of the Policy on the Company’s official website as may be required under applicable laws or RBI directions.

Annex A

Key Facts Statement

Part 1 (Interest rate and fees/charges)

² Fixed reset, other than on account of changes in credit profile

³ Please refer circular ‘Reset of Floating Interest Rate on Equated Monthly Instalments (EMI) based Personal Loans’ dated August 18, 2023.

⁴ REs may disclose the amount net of any taxes such as GST

⁵ Mention frequency, where recurring

⁶ Please refer to the illustration in Annex B

Part 2 (Other qualitative information)

⁷ RE may furnish generic email id, provided a response is made within 1 working day

Annex B

Illustration for computation of APR for Retail and MSME loans

⁸ Where such charges cannot be determined prior to sanction, REs may indicate an upper ceiling

⁹ The difference in repayment amount calculated from the total of instalments given under the detailed repayment schedule i.e., ₹23,280 (=970*24) vis-à-vis the amount of ₹23,274 (₹20,000 (loan amount) + ₹3,274 (Interest charges) mentioned under (8) is due to rounding off the instalment amount of ₹969.73 to ₹970 under the detailed repayment schedule

¹⁰ Computed on net disbursed amount using IRR approach and reducing balance method