Interest Rate Policy

Policy on Interest Rate Model, Policies and Procedure on determining Interest Rates and other charges

Based on our thinking and regulations set by regulator ,advised that Boards of Non-Banking Finance Companies(“NBFC”) to lay out appropriate internal principles and procedures in determining interest rates, processing and other charges. Further, lay out appropriate internal principles and procedures in determining interest rates, processing and other charges.

Keeping view of the Guidelines as cited above, the following internal guiding principles and interest rate model are therefore laid out by the board of Elimu Bora Services (the “Company”). This policy should always be read in conjunction with RB guidelines, directives, circulars and instructions. The Company will apply the best industry practices so long as such practice does not conflict with or violate Regulator guidelines.

The interest rates applicable to loans will be approved by the Board, from time to time.

  1. Elimu Bora Services Ltd (ELIMU PESA) will charge normal interest rate from the customer/borrower/parent/, Guardian as capped at 10%. The effective rate of interest may vary depending upon the product and borrower profile details of which will be set out in the Repayment Schedule, which are shared with the Borrower(s).
  2. The interest rate may vary basis moratorium for interest payment and repayment of principal, staggered disbursements. The pricing will be informed to the borrower in writing prior to sanction of the Loan.

Besides normal interest, the Company may collect delayed / late payment charges for any delay or default in making payments of any dues. These delayed / late payment charges for different products or facilities would be decided by the Company from time to time No claims for refund or waiver of such charges/ additional interest would normally be entertained by the company and it is the sole discretion of the company to deal with such requests if any.

All processing / documentation and other charges recovered are expressly stated in the Loan documents. They vary based on the loan product, amount of Loan, customer profile, geographical location and generally represent the cost incurred in rendering the services to the customers. The company may adopt an interest rate model whereby the rate of interest for same product and tenor availed during same period by customers would be different from customer to customer depending upon consideration of any or combination of a few or all factors listed out in point above. Hence, the interest rate applied would be different from customer to customer.

The Rate of Interest, Fee and Charges will be expressly stated in the Loan Agreement or the Sanction Letter. The information on Rate of Interest, common fees and charges will be informed to customers through any one or more of the following media:

  1. Letters or Schedules of charges to the customers;
  2. Through telephone or helplines;
  3. On the Company’s Website;
  4. Through designated staff/ helpdesk.

The Company will ensure compliance with the regulatory requirements if any, while charging pre-payment penalty for early closure of any of the loans. The interest re-set period will be decided by the company from time to time and communicated to the customer and is subject to change as the situation warrants and is subject to the risk perception of the Credit Committee’s on a case-to-case basis.

The interest rate policy will be available on the website and updated from time to time.