1. PREAMBLE

Barota Finance Limited (“BFL”) is a Non-Banking Financial Company (‘NBFC’) operating under Reserve Bank of India (‘RBI’) regulations/directions and its activities are governed by the various Indian laws and RBI regulations/directions.

This Policy is intended to be representative of BFL guiding philosophy of dealing with customers in a transparent and open manner. In accordance with the RBI guidelines vide its notification No. DNBS. 204 / CGM (ASR)-2009 dated January 2, 2009 and vide its Guidelines on FPC for NBFCs DNBS.CC.PD.No.266/03.10.01/2011-12 dated March 26, 2012 have directed all NBFCs to:

• Communicate the annualized rate of interest to the borrower along with the approach for gradation of risk and rationale for charging different rates of interest to different categories of borrowers.
• Make available the rates of interest and the approach for gradation of risks on the web-site of the company

BFL is committed to conducts its business activities lawfully and in a manner that is consistent with its compliance obligations. Activities of BFL are conducted in line with RBI / Company Law and prevailing local regulations/ rules/ laws/ Acts. In the event this Policy is at variance with regulations/ rules/ laws/ Acts at any stage due to omissions or changes in regulations/ rules /laws/ Acts, the regulations/ rules/ laws/ Acts would prevail.

2. ESTABLISHING AN INTEREST RATE

The Company intimates the borrower, the loan amount and rate of interest at the time of sanction of the loan along with the tenure and amount of the monthly instalment. The rate of interest is arrived based on the weighted average cost of funds, administrative costs, risk premium, profit margin and borrower profile.

GENERAL

The decision to give a loan and the interest rate applicable to each loan account is assessed on a case to case basis, based on multiple parameters such as borrower profile and repayment capacity, borrower’s other financial commitments, past repayment track record if any, the security for the loan as represented by the underlying assets, loan to value ratio, tenure of the loan, geography (location) of the borrower, end use of the asset etc. Such information is collated based on borrower inputs and field inspection by the company officials.

INTEREST RATE

Our Interest Rate on Tractors/Agricultural equipments vary from 16% to 24% depending on a host of factors as mentioned above.

Foreclosure Charges:

4% of the Principal Outstanding for pre-closure within the 1st year of Loan.

3% of the Principal Outstanding for pre closure after 1st year of Loan.

Late Penalty:
4% per month.

Note: The rates of interest are subject to change as the situation warrants and are subject to the discretion of the management on a case to case basis.

3. AMENDMENT TO THE POLICY

This Policy shall be reviewed by the Board as and when any changes are required in the Policy.