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Preamble:
Reserve
Bank of India vide its notification dated
January 2, 2009 have directed all NBFCs
that rates of interest and the approach
for gradation of risks shall be made available
on the web-site of the companies.
Rate
of Interest:
Company
is fixing its Reference Lending Rate (RLR)
based on the cost of fund, inherent risk
of business and cost of operation. Reference
Lending Rate of TMFL till 31 March 09 was
16.0 %.
Wef
1 April 2009 , in view of the decrease in
borrowing costs, the RLR has been fixed
at 15.75 %
Approach
for Gradation of Risk
TMFL
is primarily in financing activity of vehicles
manufactured by Tata Motors Ltd. Broadly
the risk of this business would depend on
the risk associated with the Product and
the Customer.
Following
Matrix will be used for arriving at product
specific Base Lending Rate (BLR)
| M
& HCV Trucks |
:
RLR minus 100 basis points |
| LCV
& ICV trucks |
:
RLR |
| All
Buses & Winger |
:
RLR plus 50 basis points |
| ACE
|
:
RLR plus 100 basis points |
| 207
DI |
:
RLR plus 150 basis points |
| MAGIC |
:
RLR plus 200 basis points |
| CAR |
:
RLR |
Risk
associated to customer will depend on various
factors like Loan to Value ratio, Tenure
of the Loan, Geography (Location), and usage.
The Risk factor would be converted into
an additional charge and added onto the
Base lending Rate (BLR) to give the final
IRR for the product.
Maximum
risk premium for any customer for all risk
put together with the BLR will not exceed
7% over the RLR.
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