Interest Rate Policy

1. Introduction

The Reserve Bank of India ("RBI”) vide Master Direction – Reserve Bank of India (Non-Banking Financial Companies – Responsible Business Conduct) Directions, 2025 has stipulated at Chapter III - Fair Practices Code for all applicable Non-Banking Financial Companies (“NBFCs”) and has directed all NBFCs to lay down appropriate internal policies and procedures in determining rates of interest, processing fees, other charges and display the rates of interest and the approach for gradation of risks on their website.

The objective of adopting and implementing this policy is to institute fair and transparent dealings in the lending business in accordance with the aforesaid regulatory requirements and the Fair Practices Code adopted by the Tycoon Credit & Portfolio Limited (hereinafter referred to as “TCPL” or the “Company”).

The said Interest Rate and Penal Charges Policy broadly outline the Interest Rate Model, Applicable penal charges in case of delay in repayment of loan and the Company’s approach of risk gradation in this regard.

This Policy also aligns with RBI instructions on Key Fact Statement (KFS), transparency in digital lending, and customer protection measures as applicable from time to time

2. Objective

The main objectives of this Policy are to:

• Ensure that interest rates are determined in a manner as to ensure long term sustainability of business by taking into account the interests of all stakeholders;
• Develop and adopt a suitable model for calculation of a interest rate;
• Enable fixation of interest rates which are reasonable: both actual and perceived;
• Ensure that computation of interest is accurate, fair and transparent in line with regulatory guidelines and market practices;
• Charge differential rates of interest linked to the risk factors as applicable;
• Decide on the principles, methodology and approach of charging spreads to arrive at final rates charged from customers.

3. Review and approval of the policy

This policy is approved by the Board of Directors of the Company and the Company has adopted the Policy on Interest Rate and Penal Charges taking into account relevant factors such as cost of funds, margin and risk premium and determining the rate of interest to be charged for loans and advances. Any revision in the Policy shall be reviewed by the relevant internal units and approved by the Board of Directors.

This Policy shall always be read in conjunction with extant RBI guidelines, directives, circulars and instructions.

4. Disclosures

As per extant regulations and in terms of this Policy, the following disclosures shall be made:

• The rate of interest and the approach for gradation of risks and the rationale for charging different rates of interest to different categories of borrowers shall be disclosed by the Company to the borrower or customer and will be communicated explicitly in the sanction letter.
• The rate of interest and the approach for gradation of risks shall also be made available on the website of the Company. The information published on the website shall be updated whenever there is a change in the rate of interest.
• The annualized rate of interest shall be disclosed so that the borrower is aware of the exact rates that would be charged in relation to the loan amount.
• Any change in the rate of interest or other charges, as applicable, shall, be made prospectively and the same shall be adequately disclosed in the loan agreement, sanction letter and Key Fact Statement (“KFS”).
• The quantum and reason for Penal charges shall be clearly disclosed to the customers in the loan agreement, Key Fact Statement, in addition to rate of interest and other charges being displayed on the Company’s website.

5. Principles for Determining of Interest Rates

The Company lends money to its customers mainly through digital platforms and has various products to cater to the needs of different categories of customers.

The interest rate of each product is decided from time to time, giving due consideration to the following factors:

• Cost of Capital : To run the business, the Company has been infused with equity share capital in huge proportions, and accordingly the cost of such equity share capital being infused shall be taken into consideration.
• Weighted Average cost of Borrowing: Since the Company borrows funds from various banks, financial institutions and other external lender(s), the weighted average borrowing cost, as well as costs incidental to those borrowings like brokerage, consultancy fees, processing fees shall be taken into consideration. The cost of borrowings varies according to market conditions thus pricing of interest rates shall be consequently impacted and decided accordingly.
• Risk: Risk related to loss of credit due to short tenure of loan, nature of facility, ticket size of loan, geographical condition, customer segment, sourcing channels, stability in earnings and employment, financial position, past repayment track record with us or other lenders, external ratings of customers, credit reports, customer relationship, other existing indebtedness, results from digital verifications etc.. Therefore, risk of recovery of loan shall be taken into consideration and accordingly the risk premium would be reckoned.
• Opex Cost: It includes employee expenses, office and infrastructure related fixed and variable costs, operations costs, sales and marketing expenses, etc.
• Profit Margin: Fair profit margin is added to arrive at the lending rate. The company may at its discretion fix different margins for different customers , considering the risk of default. All customers will however be notified of the interest payable for the loan to be availed from the company.

Apart from the aforesaid factors, following points also impact the interest rate determination:

• Risk profile of the borrower
• Tenor of the Loan
• Credit score of the borrower
• Credit and default risk in the related business segment
• Historical performance of similar kind of customers
• Prevailing Interest rate trends in the money market
• Treasury bill rates and the sovereign yield curve
• Market scenario relating to credit risk premia/default premia including CDS spreads
• Internal Cost of doing business
• Interest rates offered by other NBFCs in the industry
• Loan documentation and maintenance fees/ costs
• Cost for portfolio monitoring
• Customer communication costs
• Recovery costs
• Other factors that may be relevant in each case.

6. Rate of Interest

Rate of Interest shall be offered based on the parameters as explained above.

a. Our loans range from INR 5,000/- to INR 1,00,000/- with repayment periods starting from 7 days to 12 months for Unsecured consumer loans and 100000 to 2500000 months for LAP and 25000 to 500000 for EMI Loans.

b. The Board of Directors, in its meeting held on19th March, 2026, reviewed and approved the revised Interest Rate and Penal Charges Policy. The Board further resolved to update the interest rate structure, which shall now be applicable as follows:

• Pay Day Loan: 0.10% to 1.00% per day
• Business Loan: 8% to 25% per annum.
• Loan Against Property (LAP): 12% to 15% per annum.
• EMI Loan: 24% to 365% per annum, with a maximum tenure of up to 6 months

c. The Company shall ensure that interest rates, including for short-tenure or high-risk products, are reasonable, transparent, and commensurate with the risk profile and cost structure, and do not result in unfair or excessive burden on borrowers.

d. Interest rate can be of two types:

• Fixed interest rate: In fixed rate loans, lenders charge a constant personal loan rate throughout the tenure. Here the total interest payable remains fixed.
• Floating Interest Rate: Floating or variable personal loan interest rates in India are susceptible to fluctuating economic conditions. Here, the customers may get the benefits of low interest personal loans initially, but there is a possibility of the lender revising the rates as per the repo rate which may result in varying rates of interest throughout the tenure of the loan.

e. Currently, all loans offered by TCPL to its customers are at Fixed Interest rates.

f. The interest re-set period for variable rate loans would be decided by the Company from time to time. The interest could be charged on monthly or on such rest as communicated in the loan sanction terms, however, no such loans have been issued.

g. Interest rates would be intimated to the customers at the time of sanction / availing of the loan.

h. The interest shall be deemed payable immediately on the due date as communicated and no grace period for payment of interest is allowed. Besides this rate of interest, the Company may levy additional/penal charges for delay or default in making payments of any dues.

i. The changes in the interest rates and related charges would be prospective in nature and intimation of change of rate of interest or other related charges would be given to customers in a mode and manner deemed fit in accordance with applicable laws and regulations.

7. Penal charges in loan accounts

The Company shall ensure that Penalty, if charged, shall be for non-compliance of material terms and conditions of the loan agreements by customers. It shall not be levied in the form of ‘Penal Interest’ that is added to the rate of interest being levied on the loans and advances.

There shall be no capitalization of Penal Charges (i.e. no further interest computed on such charges). However, this will not affect the normal procedures for compounding of interest in the loan account.

The Company shall ensure that the quantum of Penal Charges shall be reasonable and commensurate with the non-compliance of material terms and conditions of loan agreement without being discriminatory with a particular loan / loan product. The penal charges in case of loans sanctioned to ‘individual borrowers, for purposes other than business’, shall not be higher than the penal charges applicable to non-individual borrowers for similar non-compliance of material terms and conditions.

A. Event of default which will attract Penal Charges:

• When the repayment of loan amount becomes overdue.
• Breaches to any other important or material terms and conditions of the loan contract. However, materiality would be determined by the Company as to what constitutes material breach.

B. Penal Charges:

• The Penal Charges will be levied at the rate of 1.25% per day of outstanding principal loan amount.
• The Company shall display the quantum and reason for penal charges to the customers in the loan agreement and / Key Fact Statement (KFS) as applicable.
• The applicable penal charges, as updated from time to time, shall be displayed on the Company's website.
• The Company shall ensure that the applicable penal charges are clearly communicated to the borrowers, whenever reminders for non-compliance of loan terms are sent to borrowers.
• Any instance of levy of penal charges and the reason therefore shall also be appropriately communicated to the borrowers.

C. Unregistered NACH Charges: Upto Rs 500 (see if this is applicable)

8. Other fees and charges

• Besides interest, other financial charges like processing fees, origination fees, prepayment, foreclosure charges, recovery/collection charges, re-scheduling charges, penal charges on late repayment of a loan, payment gateway charges, cheque swap charges, security swap charges, charges for issue of statement account, customer care, credit assessment, ECS/ Direct Debit/ NACH mandate registration/ lodgment/ handling or for any other service provided by the Company or cost incurred by the Company for the provision of services related to the loan granted to the customers or as per schedule of charges communicated by the company from time to time or cost towards an expense incurred by the Company for the recovery of the loan. Besides these charges, service tax and other cesses, if any, would be collected at applicable rates from time to time. Any revision in these charges would be prospective in effect with due communication to customers.
• These fees and charges may vary based on the loan type, exposure limit, expenses incurred, and customer segment and generally represent the costs incurred in rendering the services to the customer. All such fees and charges shall be clearly communicated to the customer by way of a sanction letter, KFS, financing documents and the schedule of charges notified by the Company from time to time.
• The Company may also levy and collect charges and penal charges, for delay or late payment of loan instalment and other dues to the Company and bouncing of ECS/ Direct Debit/ NACH.
• The Company may also levy and collect charges for loan documentation, portfolio monitoring, recovery of loan or for other facilities and services provided based on market standards. The details of the charges will be as per the schedule of charges.

9. Loan Cancellation

If a borrower wishes to exit the loan after it has been sanctioned, he/she can do so within 3 days of loan disbursement which shall be the free look up period. The principal amount and other applicable charges will have to be paid. However, no penalty shall be charged during such period.

10. Wavier/Refund

No claims for refund or waiver of charges / penal charges / additional charges for loan documentation, portfolio monitoring, recovery of loan or for other shall normally be entertained by TCPL and it is at the sole discretion of the Company to deal with such requests, if any.

11. Foreclosure and Part Prepayment

Foreclosure of the facility shall not attract any charges; however, the borrower shall be liable to pay interest at the contracted rate up to the date of final repayment.

Part pre-payment of the facility is strictly not permitted.

12. Communication To Customer

• The Company shall communicate the effective rate of interest - to customers at the time of sanction / availing of the loan through the acceptable mode of communication. Interest Rate Policy would be uploaded on the website of the company and any change therein would be uploaded on the web site of the Company.
• Changes in the rates and charges for existing customers, if any, would be communicated to them through various modes of communication such as on the website, digital platform and/or via email, letters, SMS, etc. However, the company would ensure that there is no change during the tenure of the loan for such loans which had already been contracted with customers

13. Amendments To This Policy

The Board of directors is authorized to make appropriate changes to this Policy taking into account changes in the money market scenario in the Country which includes the upward / downward revision in interest rates applicable to various loan products and the relevant charges applicable for such loan products.