INTEREST RATE POLICY

INTEREST RATE POLICY

This Interest Rate Policy (“Policy”) is formulated and adopted by Harshreejee Finance & Leasing Company Private Limited (“HSFLCL” or “the Company”) in accordance with the Reserve Bank of India (Non-Banking Financial Company – Scale Based Regulation) Directions, 2023 and other applicable guidelines issued by the Reserve Bank of India (“RBI”) from time to time. This Policy outlines the broad framework for determining, reviewing, and communicating the interest rates and other charges applicable to the lending operations of the Company.

1. OBJECTIVE

The objective of this Policy is to ensure that the Company adopts a transparent, consistent, and fair approach in determining the rate of interest and related charges, in compliance with regulatory requirements and to protect customer interests. It aims to ensure that interest rates are determined in a manner reflecting the cost of funds, operational expenses, credit risk, and market conditions while maintaining fairness and transparency in borrower communication.

2. SCOPE AND APPLICABILITY

This Policy applies to all loan products offered by HSFLCL, specifically payday loans disbursed to individual borrowers through digital and electronic channels including IMPS, UPI, NEFT, RTGS, and cash repayment. All lending and related charges determined under this Policy shall be governed by the principles and framework set out herein.

3. LOAN PRODUCTS AND TENURE

HSFLCL currently offers short-term payday loans to individual salaried borrowers. The following parameters apply:

  • Type of Loan: Payday Loan
  • Loan Amount Range: ₹8,000 to ₹1,00,000
  • Typical Tenure: 30 to 35 days
  • Mode of Disbursement: IMPS
  • Mode of Repayment: IMPS, UPI, NEFT, RTGS, Cash

4. INTEREST RATE FRAMEWORK

The Company charges interest on a fixed basis for all loans. The current rate structure is as follows:

  • Interest Rate: Flat 1% per day (charged on the principal outstanding).
  • Interest is computed on a daily basis for the entire tenure of the loan and is not subject to compounding.
  • The interest rate is applied uniformly to all eligible borrowers; however, risk parameters such as credit score, repayment history, and employment verification are considered during credit appraisal.

5. OTHER CHARGES

The following charges are applicable:

  • Processing Fee: 10% of the sanctioned loan amount. For example, for a loan of ₹10,000, the processing fee is ₹1,000.
  • GST: Applicable at 18% on the processing fee (e.g., ₹180 on ₹1,000).
  • Total deduction before disbursement: ₹1,180 (Processing Fee + GST). Net disbursed amount in this case: ₹8,820.
  • Penal Charges: No additional penalty beyond the daily 1% interest is levied for delay in repayment.
  • Third-Party Charges: Currently, there are no third-party gateway or ancillary charges. If introduced in future, any such charges will be borne by the customer and disclosed transparently.

6. COMPUTATION AND DISCLOSURE OF APR

  • The Annual Percentage Rate (APR) is computed by annualizing the daily rate of 1% × 365 days. Accordingly, the indicative APR is 365% per annum, exclusive of processing fees and taxes.
  • All terms, including the APR, are disclosed clearly on the Company’s website (www.hsflcl.com) and are available for review by customers prior to availing any loan.

7. DISCLOSURES AND TRANSPARENCY

HSFLCL maintains complete transparency regarding interest rates and charges. The following measures are in place:

  • Rate of Interest (ROI) is displayed on the Company’s website under the Loan Calculator page.
  • Any change in rate or fee structure will be approved by the Board of Directors and updated on the website.
  • Borrowers receive clear information on applicable charges through the Key Fact Statement (KFS) and the loan agreement.

8. PRICING GOVERNANCE AND REVIEW

  • The rate of interest and any change thereto shall be determined by the Board of Directors based on prevailing market trends, cost of funds, and risk profile of the borrower segment.
  • Any proposal to modify interest rates or charges shall be placed before the Board in its regular meeting for consideration and approval.
  • The interest rate structure will be reviewed annually by the Board to ensure continued alignment with regulatory requirements and market dynamics.

9. CUSTOMER SEGMENT AND ELIGIBILITY

HSFLCL extends credit exclusively to individual salaried borrowers who meet its internal eligibility criteria. The Company does not extend loans to or accept applications from the following categories: advocates, police/defence personnel, chartered accountants, company secretaries, government employees, self-employed individuals, or businessmen. The Company reserves the right to determine its eligible customer segment based on internal risk assessments.

10. COMMUNICATION OF POLICY

This Interest Rate Policy will be published on the Company’s website and made available to customers upon request. All employees involved in loan origination and servicing will be trained to ensure adherence to this Policy and the principles of fair and transparent lending.

11. REVIEW AND AMENDMENT

This Policy shall be reviewed annually or as and when required due to changes in