Interest Rate Policy
This policy is intended to be representative of Indiumplus Financial Services Pvt Ltd (‘Indium’ or ‘the Company’) guiding philosophy of dealing with customers in a transparent and an open manner.
RBI Master Directions RBI/DNBR/2016-17/45 Master Direction DNBR. PD. 008/03.10.119/2016-17 dated September 01, 2016 under its Fair Practices Code advised NBFC to lay out appropriate principles and procedures so that usurious interest, including processing and other charges are not levied on loans and advances.
Indium has hence documented its Interest Rate Policy / Model, which lays down internal principles and procedures in determining interest rates on the loan products offered by Indium.
Methodology of Arriving at Interest rate for Loans and Approach for Gradation of Risk:
- The Company has its own model for arriving at lending interest rates. The lending interest rates to the customer are determined based on multiple factors including, but not limited to, cost of borrowed funds, tenor of loan, liquidity conditions prevailing in the market, cost of operations, credit risk arising from the borrower or pool of borrowers and the minimum margin
- The customer level credit risk premium as mentioned above shall be based on credit and default risk of the customer as assessed by our proprietary risk model, which considers amongst other factors : profile & risk rating of customer, earning and repayment ability of the customer, nature and value of primary and collateral securities, direct and indirect costs involved, repayment track record of the customers in case of existing customers, credit bureau ratings of the customers , industry trends, deviations permitted, future potential. Such information is gathered based on the information provided by the borrower, credit reports, data sources and market intelligence.
- Based on the above, the rate of interest can vary significantly from one customer to another for the same product and tenor. Similarly, the same customer can be charged different rates for different products at the same time, or different rates for the same product taken at different points of time.
- For products where partial drawdown is allowed, the Company reserves the right to modify the rate of interest based on prevailing conditions at the time of each such partial drawdown.
- Currently, only fixed Interest rate loans are being offered by the company. Introduction of floating rate loans or hybrid interest rate loans shall be duly intimated on our website and incorporated in our marketing documents
- The interest could be charged on weekly, biweekly, monthly or quarterly rests for different products / segments.
- Besides regular interest, the company may levy additional/penal interest for delay or default in making payments of any dues. These additional or penal interests may vary for different products. These shall be communicated to the customers at the time of sanction of loans and also incorporated in the loan documents.
- Annualized Rates of interest on unsecured products shall not exceed 36% per annum and on secured products shall not exceed 24% per annum. Any revisions to these caps will be at the sole discretion of Company.
- Besides interest, other financial charges like processing fees, application fees, cheque/NACH bounce charges, mandate swap charges, late payment charges, legal charges, pre-payment / foreclosure charges, collections charges, NOC issuance charges, etc., would be levied by the Company wherever considered necessary. Besides these charges, stamp duty, GST and other cess would be collected at an applicable rate from time to time, as communicated in the documentation provided. Any revision in these charges would have a prospective effect and will be communicated to the borrower
- While deciding the charges, the practices followed by the competitors in the market would also be taken into consideration.
- Claims for refund or waiver of charges / penal interest / 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. Genuine refund claims are processed by the Company and any additional amount received in addition of due amount is refunded to the borrowers.
Review of the Policy
The Policy will be reviewed at yearly intervals or as and when considered necessary by the Board of the Company.