Interest Rate and Charges Policy
Interest Rate and Charges Policy
for loan products offered through Digital Lending Applications
1. Introduction
Yuvaraj Finance Private Limited (“us”, “we”, or “Yuvaraj”) is a registered NBFC (Non-banking Financial Company) that engages Digital Lending Apps (DLA) and Lending Service Providers (LSP) for extending credit facilitation services.
This Interest Rate Policy (the “Policy”) has been formulated in accordance with the guidelines issued by the Reserve Bank of India (RBI) and aims to ensure transparency, fairness, and uniformity in the application of interest rates on loans and advances offered through our DLAs to its customers.
2. Objectives
The primary objectives of this Policy are to:
- Ensure that the interest rates charged by Yuvaraj are transparent, fair, and in compliance with regulatory requirements.
- Provide clarity regarding the methodology and rationale behind the determination of interest rates.
- Outline the factors considered in the determination of interest rates and other charges.
- Ensure that DLAs follow regulatory requirements and Company`s instructions.
3. Determinants of Interest Rates
The interest rates charged by the Company will be determined based on various factors, including but not limited to the following:
- Cost of Funds: The cost of funds, including the cost of borrowings and other associated costs.
- Credit Risk: The credit risk profile of the Customer, including their credit history, repayment capacity, and overall financial stability.
- Loan Tenure: The duration of the loan, with different rates applicable for different loan tenures.
- Market Conditions: Prevailing market conditions, including interest rates in the banking and financial sectors.
- Operating Costs: Administrative and operational costs associated with the loan.
- Regulatory Requirements: Compliance with RBI guidelines and other statutory requirements.
4. Fixed Interest Rate
The Company will offer loans only at fixed interest rates. The interest rate will remain constant for the entire tenure of the loan, providing certainty and stability to the Customer. Interest shall not exceed 36% per annum.
5. Service Charges
The Company may engage Digital Lending Apps (DLA) – App(s) of the Company and/or Apps operated by Lending Service Providers (LSPs), for extending any credit facilitation services.
The Company may charge from the Borrowers different Service Charges connected to the use of DLA.
The above includes but is not limited to:
- onboarding fee – one time fee for new customer onboarding, verification and registration in the system, shall not exceed 84 Rs, excluding GST;
- servicing fee – fee for servicing the loan origination, loan application, customer support.
Shall not exceed the following amounts, excluding GST, in Rs.
| from_loan_amount | to_loan_amount | Maximum amount |
| 1 | 1999 | 194 |
| 2000 | 2999 | 389 |
| 3000 | 3999 | 584 |
| 4000 | 4999 | 779 |
| 5000 | 5999 | 974 |
| 6000 | 6999 | 1169 |
| 7000 | 7999 | 1364 |
| 8000 | 8999 | 1558 |
| 9000 | 9999 | 1753 |
| 10000 | 10999 | 1948 |
| 11000 | 11999 | 2143 |
| 12000 | 12999 | 2338 |
| 13000 | 13999 | 2533 |
| 14000 | 14999 | 2728 |
| 15000 | 15999 | 2923 |
- convenience fee – fee for speed process and digital processing.
Shall not exceed the following amounts, excluding GST, in Rs.
| from_loan_amount | to_loan_amount | Maximum amount |
| 1 | 1999 | 203 |
| 2000 | 2999 | 407 |
| 3000 | 3999 | 610 |
| 4000 | 4999 | 814 |
| 5000 | 5999 | 1017 |
| 6000 | 6999 | 1220 |
| 7000 | 7999 | 1424 |
| 8000 | 8999 | 1627 |
| 9000 | 9999 | 1831 |
| 10000 | 10999 | 2034 |
| 11000 | 11999 | 2237 |
| 12000 | 12999 | 2441 |
| 13000 | 13999 | 2644 |
| 14000 | 14999 | 2847 |
| 15000 | 15999 | 3051 |
- late payment fee – up to 28% net GST for defaulted loans only,
- and other fees that are expressly stated in the Loan documents.
6. Annual Percentage Rate (APR) and Key Fact Statement (KFS)
The APR shall be disclosed to the Customer, representing the true cost of borrowing, including the interest rate, processing fees, and any other charges.
All fees and charges shall be disclosed to the Customer prior to signing the loan agreement in the Key Fact Statement (KFS).
7. Penal Charges
The Company reserves the right to charge penal charges (late payment fee) on overdue amounts in accordance with the terms of the loan agreement.
The quantum of penal charges may vary for different products or facilities and is always specified in the loan documents, however, it shall not exceed an amount equal to 28% net GST of the principal loan amount, and in any case, shall not exceed 5600 Rs (five thousand six hundred Rupees) net GST per loan taken.
The Company reserves the right to change the quantum of penal charges from time to time, provided that for each individual Customer, it shall not be changed during the validity period of the loan agreement.
8. Communication of Interest Rates and Charges
The interest rates and applicable fees for loan products shall be communicated to the Customer through loan agreements, sanction letters and/or the Key Fact Statement (KFS).
Changes in interest rates or charges, if any, shall be communicated to the Customer in advance. Changes shall be effective only prospectively.
9. Review and Changes
The interest rates and this Policy may be reviewed periodically to ensure alignment with market conditions and regulatory requirements.
The Company may update this Policy from time to time. The Company will notify DLAs and Customers of any changes.
10. Regulatory Compliance
This Policy is in compliance with the guidelines issued by the RBI and will be updated periodically to reflect any changes in regulatory requirements.
11. Grievance Redressal
Customers having any grievances related to the interest rates or any other charges can approach the Grievance Redressal Officer of the Company. The contact details of the Grievance Redressal Officer shall be available on the Company’s website and loan documents. In addition, DLAs shall have their own Grievance Redressal Officer whose contact details shall be published on DLAs/LSPs website.