What a loan app's cost looks like as an annual rate
An annualised rate states the cost of a loan as if it ran for a full year, so that loans of different lengths can be compared. Take a loan shown as Rs 10,000, of which Rs 8,800 reaches the bank account, with Rs 10,600 repaid after 30 days. In rupees the cost is Rs 1,800. Over 30 days that is 20.5% of the money received. A year holds about 12.2 periods of 30 days, so the same cost is 248.9% a year.
The rupee figure and the rate describe the same loan. The rate grows as the loan gets shorter, because the same cost repeats more often in a year: Rs 300 on Rs 2,700 for seven days is 11.1% for the week and 579.4% a year.
The amount that reaches the account matters as much as the amount repaid. A fee cut before payout leaves the borrower less money for the same repayments. The RBI's own example of the Annual Percentage Rate computes it on the net amount disbursed. Against the full Rs 10,000, the repayment in the example above works out to 73.0% a year; against the Rs 8,800 actually received, 248.9%.
What a Key Facts Statement is
A Key Facts Statement (KFS) is a summary of a loan in a standard format set by the RBI. An NBFC must give one to every prospective borrower before the loan contract is signed, in a language the borrower understands, for retail and MSME term loans sanctioned on or after 1 October 2024. It carries the Annual Percentage Rate, a computation sheet showing how that rate was reached, and the repayment schedule.
The APR is the annual cost of credit including interest and all other charges of the loan, including charges the lender collects for third parties such as insurance and legal charges. Fees and charges not mentioned in the KFS cannot be charged at any stage of the loan without the borrower's explicit consent. The borrower has at least three working days to accept the KFS terms for a loan of seven days or more, and one working day for a shorter loan. For a digital loan, the KFS, sanction letter and terms go automatically to the borrower's registered email or SMS when the loan is signed.
How this page works out the rate
The page finds the rate per repayment interval at which the repayments, discounted back to the day the money arrived, equal the money received, and multiplies it by the number of intervals in a year. This is the IRR method on a reducing balance that the RBI uses in its KFS example. Entered here, that example's figures (Rs 19,600 disbursed, 24 monthly instalments of Rs 969.73) give the same 17.07% the RBI prints.
When the figures do not match
The lender must name a nodal grievance redressal officer for digital lending complaints, and the officer's contact details must be in the KFS. If the lender rejects the complaint, the reply is unsatisfactory, or there is no reply within 30 days, the complaint can be filed with the RBI at cms.rbi.org.in.
The RBI Ombudsman scheme is free of cost. Under the 2026 scheme, in force from 1 July 2026, a complaint must reach the Ombudsman within 90 days of the end of the lender's 30 days or of the lender's last reply, whichever is later. The RBI asks for the lender's complaint number and date, its reply, and the documents that support the complaint. The figures on this page come from four of them: the KFS, the sanction letter, the bank statement showing the credit, and the record of each repayment.
Oquilia has reported on what these figures look like in practice: one borrower's 84 loans from 30 lenders in seven months, the RBI's digital lending enforcement from July to September 2026, and the running digital lending enforcement tracker.