Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

From the following information, calculate the maximum rate of interest that a NBFC-MFI can charge on loans given by the institution. (a) The loan is

From the following information, calculate the maximum rate of interest that a NBFC-MFI can

charge on loans given by the institution.

(a) The loan is being given in September, 2020

(b) The average base rate of 5 largest commercial banks announced by RBI for the

quarter beginning 1st July, 2020 is 8.61%

(c) The cost of funds for the MFI is 12%

Your answer should be based on the RBI regulations for maximum interest rate that can be charged

by NBFC-MFIs on loans given by them. You need to explain the RBI regulations and show the

calculations. Stating only the maximum rate of interest is not enough. If any required information is

missing, make reasonable assumption about the missing information and proceed.

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Personal Finance

Authors: Jeff Madura

5th edition

132994348, 978-0132994347

More Books

Students also viewed these Finance questions

Question

what are the interpreted results for the SIM test?

Answered: 1 week ago

Question

Prove that if Σ an is absolutely convergent, then a. an

Answered: 1 week ago