Determining interest rates and assessing risk through transparent processes that comply with RBI regulations.
Reserve Bank of India (RBI) vide its Circular DNBS / PD / CC No. 95/ 03.05.002/ 2006-07 dated May 24, 2007 advised Non Banking Finance Companies (NBFCs) to lay out appropriate internal principles and procedures in determining interest rates, processing and other charges. Keeping in view the RBI's guidelines and good governance practices, the following internal guidelines, policies, procedures, and interest rate policy have been adopted by the Company for its lending business.
The base interest rate will be arrived at based on the weighted average cost of funds, risk premium, other costs such as administrative expenses and profit margin.
The base interest rate applicable to each loan account will be assessed based on multiple parameters like:
The rate of interest charged to our customers is linked to the base rate which is determined based on weighted average cost of funds, risk premium, other costs such as administrative expenses and profit margin. The mark up over the base rate varies from 200 bps to 1300 bps depending on the risk profile of the customer. Accordingly, the present rate of interest charged to our customers is in the range of 12% to 36% payable monthly.
Claims for refund or waiver of charges, penal interest, or additional interest would normally not be entertained by the company, and it is at the sole discretion of the company to deal with such requests if any.
