Savery Transport Finance Limited

This Policy was last reviewed and approved by the Board of Directors at it’s Meeting held on October 21,2025.

Policy on Interest rate model

I. INTRODUCTION

Savery Transport Finance Limited (STFL) is a Non-Banking Financial Company–Non-Systemically Important Non-Deposit taking Company(NBFC) registered with the Reserve Bank of India.

II. PURPOSE

Keeping in view the good governance and fair practices code prescribed by Reserve Bank of India, the Company decided to adopt the following internal guidelines and procedures in the matter of fixation of interest rate model and the method of levying charges from the customers for its lending business.

III. SCHEME

This Policy is divided into two parts. The First Part deals with the matters relating to interest and the Second Part deals with matters relating to charges being levied from the customer other than the interest.

PART- I

RATE OF INTEREST

Interest rate shall mean the annualised rate on the credit facilities charged to the borrower by the Company. The interest rate shall not include the following (the exclusion list is indicative in nature and shall not be only limited to the components below)

1) Processing costs
2) Document charges
3) Repossession expenses

A. Fixation of Interest

The Company shall be guided by this Policy for determining the interest rates on various loan schemes of the Company. It shall also consider the prevailing market conditions, various rules and regulations prescribed by the RBI or such other competent authority, as applicable, from time to while fixing the interest rates.

The rate of interest is annualised rates so that the borrower is aware of the exact rates that will be charged to the account. The customer is given a copy of sanction letter which has all loan conditions for transparency. The sanction letter clearly defines the rate of interest, penal charges in case of delays etc. STFL follows ceiling of Annualised interest rates not exceeding 32% p.a. and processing charges not exceeding 2.50% on loan amount.

B. Components of Interest leviable

n the case of an account which is serviced regularly and operated without default, the interest charged would have two components viz. Basic Rate and Risk Premium. However, if an account is not serviced regularly and default occurs, the interest leviable in such accounts will have one more component called penal charges. Each component of the interest is explained below:

1. Basic Rate:

Basic Rate shall be arrived at after considering the following aspect:
a) Cost of Funds: This includes the interest and other related charges payable by the Company on the borrowed funds such as loan from Banks/Financial Institutions, Secured NCD’s, etc.
b) Operating Cost: This includes the employee cost and other administrative and operating overheads of the Company.
c) Gradation of Risk: The nature of risk associated with the loan will always have a bearing on the Basic Rate to be arrived at.
d) Return on Equity: After meeting all the above (a, b and c), a reasonable return on equity is to be ensured in arriving at the base rate.
e) Other Factors: Industry trends / offers from competitors.
Apart from the above, the nature of lending, i.e., unsecured/secured, tenure of lending, margin covering regulatory provisions, if any, industry trends - offerings by competition, etc. shall also be considered to derive the basic rate

2. Risk Premium

While fixing the risk premium, the Company shall take into consideration, the LTV rate applicable to the loan, the frequency of servicing of the loan by the customer, risk perception of the Company based on geographical location, class of customers, etc. Risk profile of customer including the professional qualification, stability in earnings and employment, financial positions, past repayment track record with us or other lenders, external ratings of customers, credit reports, customer relationship, future business potential, etc. shall also be considered.

C. Rate of Interest

i) Regular Accounts (loan accounts serviced regularly)

The Company intimates the customer, the exact loan amount, rate of interest and Documentation & Processing Fee applicable, at the time of sanction of the loan along with the tenure and amount of monthly instalments (EMI). The following would be the broad band of the total amount due from the customer aggregately towards the interest rate and Documentation & Processing Fee in respect of a loan account which is serviced regularly without any default and also dependent on the scheme. This rate is excluding the penal charges leviable in case of default.

The applicable range of rate of interest is described in point no E along with gradation of risk.

ii) Irregular Accounts

When an account is not serviced regularly i.e., when the EMI is not paid on the due date and the amount is outstanding, resulting in default in repayment of the loan amount, regular contract rate on the overdue EMI will be charged along with additional amount called penal charges will be levied at the rate of applicable anualised rate 36% per annum to the particular loan on the overdue EMI/Uupaid expenses without compounding the same.

iii) Maximum Rate of Interest Leviable on a loan account

a) Regular Accounts (Ref. (i) above): 32%(Thirty-Two) percent per annum Contracted Interest rate subject to the proviso under Clause C (i).

b) Irregular Accounts (Ref (ii) above): 36%(Thirty-Six) percent per annum on the overdue EMI per month without compounding in addition to that as applicable to the Regular Accounts.

D. Procedure/Method of Collection of Interest

i) The rate of interest leviable on each loan account will be communicated to the customer upfront. Accordingly, the rate of interest charged would be specified in the loan sanction letter and loan agreement. Further, whenever notice is issued to the customer for collection of the interest, the rate and amount thereof would be clearly stated in the said notice. The same procedure would be followed in the case of levying penal charges.

ii) The interest being collected is included in the EMI payable by the customer and hence with the payment of each EMI by the customer, the interest applicable will also remain collected.

iii) When an account has turned irregular and the customer makes any payment towards the repayment of his dues to the Company disregarding the amount of EMI, the amount so received would be credited to the loan account in the following order:

a) Interest
b) Principal
c) Accured Interest on EMI Overdues
d) Penal Charges other than the Interest & Principal

E. Approach for Gradation of Risk

The rate of interest is arrived at based on the cost of funds, operating cost, nature of risk and return on capital and other factors stated in this policy. Approach for gradations of risk and rationale, the rates of interest for the same product and same tenor availed during the same period by different customers could vary depending upon the combination of various factors such as borrower’s profile including age, number of dependents, residential stability, type of employment and length of service, primary and secondary income, vintage and growth in business (if self-employed), nature and type of collateral security, brand/resale value of the vehicle, past repayment track record, past association with STFL,Loan to Value etc. Such information is collated based on customer input, credit bureau and field inspection by the Company officials The Company shall be charging annualised interest rate on loans and advances extended to customers. The annualised interest shall be communicated explicitly in the Sanction letter. Any revision/change in the interest rate/other charges would be effected prospectively only. The interest shall be amortised with the principal and the monthly due shall be repaid by way of instalments. The company may offer an equated monthly instalment. The company may accept part payment of instalment. The rate of interest is subject to change as the situation warrants due to market compulsions and change in regulatory norms and is also subject to the discretion of the management on a case to case basis, for reasons which will be noted. The interest rates proposed for different loans and advances extended by the Company to its borrowers, are given as under:

Lending Rate Range for Vehicle Loan-Fixed Rates(IRR)

Products	Interest Type	IRR %
		Minimum	Maximum
Two-Wheeler – New	Fixed	21	27
Two-Wheeler – Used	Fixed	27	32
Pronote Loan(DPN)	Fixed	21	32

- All the rates mentioned are annualized at monthly rests.

PART- II

LEVY OF CHARGES OTHER THAN INTEREST, DOCUMENTATION CHARGES AND ADDITIONAL CHARGES

Depending on the nature of the transaction, in addition to the interest and penal charges, the Company may also levy certain charges from the customer. These charges were until now stated as “Other Charges” and now it has been decided to specify each of them as applicable in the communication to the customer and all other related documents whenever and wherever applicable.

A. The following are the charges falling under this category:

Document charges:

TThe loan amount is approved, the processing/document charges proposed for different loans and advances extended by the Company to its borrowers, are given as under. Document charges not exceeding 2.50% of Loan amount.

Insurance Premium:

Vehicles financed are to be insured covering the value of vehicle in full and company’s hypothecation on the vehicle generally should be noted in the insurance policy.

Repossession Charges:

When the vehicle is to be repossessed, the Company incurs charges for repossessing the same which is recoverable from the customer at actual.

IV. REVIEW & AMENDMENT OF THE POLICY

Any change in this Policy shall be approved by the Board of Directors of the Company. The Board of Directors shall have the right to review any part of this Policy or the entire Policy at any time, as it deems fit, or from time to time, and the decision of the Board in this respect shall be final and binding.

Part- I

Lending Rate Range for Vehicle Loan-Fixed Rates(IRR)

Products	Interest Type	IRR % Range
		Minimum	Maximum
Two-Wheeler – New	Fixed	21	27
Two-Wheeler – Used	Fixed	27	32
Pronote Loan(DPN)	Fixed	21	32

All the rates mentioned are annualized at monthly rests.

Part- II

Other Charges

S. No.	Charges Head	Charges / Ranges
1.	Document Charges	Upto 2.5% of Loan Amount
2.	Penal Charges	36% per annum on the overdue EMI/unpaid expenses for the period of delay without compounding the same.
3.	Repossession charges	Actuals

The above charges are exclusive of GST, and applicable GST rates will be charged extra.

FAIR PRACTICE CODE in ENGLISH

This fair practice code sets out the minimum practices to be followed by the Company while dealing with the customers. This code is formulated in pursuance of the guidelines issued by the Reserve Bank of India on fair practice code for NBFCs, to ensure better service and provide necessary information to customers to take informed decisions.

I. OBJECTIVES

This code has been developed to:

1. Promote good and fair practices by setting standards in dealing with the customers.

2. To provide the necessary information to the customers, to increase the transparency in the dealings, to appraise them of the services rendered by the Company so that the customers can take informed decision.

3. To promote a fair and cordial relationship with the customers.

4. To encourage market forces through competition, to achieve higher operating and transparency standards.

II. APPLICATIONS FOR LOANS AND THEIR PROCESSING

1. All communications to the borrower shall be in the vernacular language or in a language as understood by the borrower.

2. Loan application forms shall include necessary information which affects the interest of the borrower, so that a meaningful comparison with the terms and conditions offered by other NBFCs can be made and informed decision can be taken by the borrower. The loan application form indicates the documents required to be submitted along with the application form. It shall also specify the charges payable by the borrower for availing of the loan and also during the currency of the loan till its closure.

3. The Company shall provide acknowledgement for receipt of all loan approvals through SMS in the registered mobile number of the applicant.

III. LOAN APPRAISAL AND TERMS/CONDITIONS

1. The Company shall convey in writing to the borrower in the vernacular language or in a language as understood by the borrower, by means of sanction letter, the amount of loan sanctioned along with the terms and conditions including annualized rate of interest, all other charges payable either upfront or during the tenure of the loan till its closure, the method of application thereof and shall keep on record the acceptance of these terms and conditions by the borrower.

2. The loan agreement shall also contain a clause for charging the penal Charges, if any, for late repayment in bold.

3. The Company shall ensure that a copy of the loan agreement along with a copy each of all enclosures quoted in the loan agreement is handed over to the borrower at the time of sanction/disbursement of the loan.

IV. PENAL CHARGES IN LOAN ACCOUNTS

1. Penalty if charged for non-compliance of material terms and conditions of loan contract by the borrower shall be treated as penal charges and shall not be levied in the form of penal interest that is added to the rate of interest charged on the advances.

2. There shall be no capitalization of penal charges ie no further interest shall be computed on such charges. However, this will not affect the normal procedures for compounding of interest in the loan account.

3. The Company shall amend the Board approved policy to include clauses for penal charges.

4. The quantum of penal charges shall be reasonable and commensurate with the non-compliance of material terms and conditions of loan contract without being discriminatory within a particular loan / product category.

5. The quantum and reason for penal charges shall be clearly disclosed by NBFCs to the customers in the loan agreement.

6. Whenever reminders for non-compliance of material terms and conditions of loan are sent to borrowers, the applicable penal charges shall be communicated. Further, any instance of levy of penal charges and the reason therefor shall also be communicated.

V. DISBURSEMENT OF LOANS INCLUDING CHANGES IN TERMS AND CONDITIONS

1. The Company shall give notice to the borrower of any change in the terms and conditions including disbursement schedule, interest rates, service charges, prepayment charges, etc.

2. Any changes in interest rates and charges shall be effected only prospectively. The loan agreement shall contain the necessary provisions in this regard.

3. Decision to recall/accelerate payment or performance under the agreement shall be in consonance with the loan agreement.

4. The Company shall release all securities on repayment of all dues or on realization of the outstanding amount of loan subject to any legitimate right or lien for any other claim the Company shall have against the borrower. If the right of set off is to be exercised, the borrower shall be given notice about the same with full particulars about the remaining claims and the conditions under the company is entitled to retain the securities till the relevant claim is settled/paid.

VI. RATE OF INTEREST

1. The Company shall frame appropriate internal principles and procedures for determining the interest rates and processing and other charges, if any, and also to ensure that they are not excessive. The Company shall, at the time of disbursal, ensure that the interest rate and other charges, if any, on loan and advances are in strict adherence to above referred internal principles and procedures.

2. The Company shall disclose in the application form and explicitly in the sanction letter, the rate of interest and the approach for gradation of risk and rationale for charging different rate of interest to different categories of borrowers.

3. The Company shall publish the rates of interest and the approach for gradation of risks in the website of the Company and shall be updated whenever there is a change in the rate of interest.

4. The Company shall also mention the annualized rates so as to make the borrower aware of the exact rates that would be charged to the account. The customer is given a copy of sanction letter which has all loan conditions for transparency. The sanction letter clearly defines the rate of interest, penal rate of interest in case of delays etc. STFL follows ceiling of interest rates not exceeding 32% p.a. and Document charges not exceeding 2.50% of the Loan amount.

VII. GENERAL

1. The Company shall refrain from interference in the affairs of the borrower except for the purposes provided in the terms and conditions of the loan agreement (unless new information, not earlier disclosed by the borrower, has come to the notice of the lender).

2. In the matter of recovery of loans, the Company shall not resort to undue harassment viz. persistently bothering the borrowers at odd hours, use of muscle power for recovery of loans.

3. In case of receipt of request from the borrower for transfer of borrowal account, the consent or otherwise i.e. objection of the Company, if any, should be conveyed within 21 days from the date of receipt of request. Such transfer shall be as per transparent contractual terms in consonance with law.

VIII. REPOSSESSION OF SECURITY

1. The Lender has the right to take possession of the Asset by giving 7 days’ notice to the Borrower to clear the dues or to hand over possession of the Asset. Such notice need not be given in the following circumstances:
a. When the Borrower agrees for waiver of such notice
b. When the Borrower has expressed his willingness to surrender the possession of the asset voluntarily
c. When there is reasonable apprehension to the Lender or its officers/agents that such notice may defeat the taking of possession of the Asset due to any foul play or forcible resistance from the part of the Borrower/Guarantor
d. When the Asset remains abandoned by the Borrower for any reason
e. When the Borrower is no more
f. When the Borrower has absconded with a view to prevent the recovery of the dues from him and
g. For any other similar reasons so as to facilitate peaceful taking possession of the Asset by the Lender.

2.The procedure for taking possession of the Asset includes:
a. When the Borrower fails to follow the demand made in the above referred to notice the Lender may approach appropriate forum for an order enabling it to take possession of the Asset by suitable ways either by way of a commissioner or receiver.
b. By asking the customer personally to surrender the vehicle at a place convenient to the Lender and
c. By compelling the Borrower to hand over possession through the authorities so as to prevent the use of the Asset by the Borrower.

3. However, the above two clauses (1 and 2) are not applicable to the cases wherein the Borrower surrenders the asset voluntarily.

4. Provision regarding final chance to be given to the borrower for repayment of the loan before the sale/auction of the property.

5. The Lender is entitled to transfer in any form like sale, rental and conversion for own use etc. the Asset, the possession of which is obtained in any of the ways stated above or otherwise, in connection with the default, in the way convenient to the Lender and appropriate the proceeds thereof towards repayment/dues from the Borrower, when the Borrower and Guarantor fails to follow the notice for repayment of the dues within 7 days in any of the modes of service of such notice at the convenience of the Lender, as a final chance to avoid the transfer under this clause. This right to transfer does not take away the sole discretion of the Lender to return the possession of the asset in appropriate cases.

6. If such sale proceeds are insufficient to discharge the entire dues, Lender shall move further against the Borrower and/or the Guarantor and if the sale proceeds exceeds the due, the balance shall be paid to the Borrower when he claims it. However, the above entitlement is no bar for the Lender to proceed against the Borrower and/or Guarantor directly, sparing the proceedings against the security.

The Lender is entitled to recover from the Borrower all types of expenses on full indemnity basis, incurred by or on behalf of the Lender in ascertaining the whereabouts of the asset, taking possession, garaging, insuring, transporting and selling the Asset and also for other legal steps in connection with this Agreement.

The Company shall include a built-in re-possession clause in the loan agreement with the borrower which shall be legally enforceable. To ensure transparency, the terms and conditions of the loan agreement shall also contain provisions regarding:

a. notice period before taking possession.
b. circumstances under which the notice period can be waived.
c. the procedure for taking possession of the security.
d. a provision regarding final chance to be given to the borrower for repayment of loan before the sale / auction of the property.
e. the procedure for giving repossession to the borrower, and
f. the procedure for sale / auction of the property.

A copy of such terms and conditions shall be made available to the borrowers.

IX.The Company shall clearly specify the exact due dates for repayment of a loan, frequency of repayment, breakup between principal and interest, examples of SMA/NPA classification dates, etc. in the loan agreement and the borrower shall be apprised of the same at the time of loan sanction and also at the time of subsequent changes, if any, to the sanction terms/loan agreement till full repayment of the loan. In cases of loan facilities with moratorium, the exact date of commencement of repayment shall also be specified in the loan agreements.

X.Consumer Education

The Company shall place consumer education literature on its websites, explaining with examples, the concepts of date of overdue, SMA and NPA classification and upgradation, with specific reference to day-end process with a view to increasing awareness among the borrowers. The Company shall also display such consumer education literature in its branches by means of posters and/or other appropriate media. Further, the Company shall also ensure that its front-line officers educate borrowers about all these concepts, with respect to loans availed by them, at the time of sanction/disbursal/renewal of loans.

XI. CUSTOMER GRIEVANCE

All disputes arising out of the decisions of the functionaries in relation to the products and services shall be heard and disposed off at least at the next higher level. Therefore, the following 'Grievances Redressal Mechanism' is put in place.

If you have any complaint/grievance, Kindly contact:

The General Manager
Savery Transport Finance Ltd
Ahuja Towers,3rdFloor,No:42/16,
ThiruVenkataswamy Road(West)
R.S.Puram,Coimbatore-641 002.
Tel:0422-4366937,4366938
Email:shriramtradefin@yahoo.co.in

If you desire to escalate your complaint/grievance to senior level. The customer may send a written communication to office of the Company at the following address:

Grievance Redressal Officer
Savery Transport Finance Ltd
“SPL SriramNivas” 3rd Floor,
No:38, Venkatakrishna Road, Mandaveli,
Chennai-600028.
Tel: 044-42089091,42035338
Email:care@savery.co.in

If the complaint/grievance is not redressed within a period of one month, the customer may appeal to:

The Company shall be responding to the complaints within a maximum period of 30 days from the date of receipt of the complaint. If the customer has not received any response within 30 days or if the customer is not satisfied with the response, then he/she may raise a complaint with the Reserve Bank of India either through RBI CMS Portal or RBI Contact Centre as given below:-

RBI CMS Portal:	https://cms.rbi.org.in
RBI Contact Centre Phone Number:	14448
RBI Postal Address:	Reserve Bank of India
	Centralised Receipt and Processing Centre,
	4th Floor, Sector 17,
	Chandigarh – 160017

X.REVIEW

A review of the compliance of the Fair Practices Code and the functioning of the Grievance Redressal Mechanism will be carried out by the Board of Directors every year.

Consumer Literature on NPA and SMA

Consumer Education Literature

Pursuant to “Master Direction – Reserve Bank of India (Non-Banking Financial Company Scale Based Regulation) Directions, 2023 (RBI/DoR/2023-24/106 DoR.FIN.REC.No.45/03.10.119/2023-24)” dated October 19, 2023 (as amended), The RBI has clarified certain aspects of Overdue dates and SMA/NPA classification dates etc., as mentioned below, to ensure uniformity across all lending institutions.

Due date/repayment date

It is the date on which the principal / interest / any charges levied on the loan account are payable as mentioned in sanction terms/loan agreement.

Overdue (default) accounts

An account shall be in default when principal including arrears of interest and any other amount due is not paid in full as seen on the respective due date mentioned in sanction terms/loan agreement, such account shall be specified as overdue loan account.

The Company shall flag the Loan account as overdue as part of the day-end processes for the due date, irrespective of the time of running such processes.

Classification as Special Mention Account (SMA) and Non-Performing Asset (NPA)

An overdue loan account shall be classified as SMA (Special Mention Account) or NPA (Non-Performing Asset) as per RBI regulations as notified vide circular dated November 12, 2021 and February 15, 2022.

Classification as Special Mention Account (SMA)

The Company shall recognise incipient stress in borrower accounts, immediately on default, by classifying them as special mention accounts (SMA). The basis for classification of SMA categories shall be as follows:

Loans other than revolving facilities
SMA Sub-categories	Basis for classification – Principal or interest payment or any other amount wholly or partly overdue
SMA-0	Upto 30 days
SMA-1	More than 30 days and upto 60 days
SMA-2	More than 60 days and upto 90 days

Classification as Non-Performing Asset (NPA)

The loan account shall be classified as Non-Performing Asset (NPA) when Principal or interest payment or any other amount remains overdue for a period of more than 90 days.

The examples of Special Mention Account (SMA) and Non-Performing Asset (NPA) classification mentioned below are illustrative and not exhaustive in nature and relate to general scenarios.

Illustration:

If the instalment due date of a loan account falls on April 05, 202X, May 05, 202X, June 05, 202X, July 05, 202X and so on, then the SMA/NPA classification for the respective due amount will be done upon running day end processes. The indicative SMA/NPA classification of the amount falling due on April 05, 202X shall be as follows:

Respective Due Date	Payment Status	Days Overdue	Upon Running day end process on	SMA / NPA Classification
April,05, 202X	Amount due on 05-Apr-202X not paid in full	Upto 30 days	April 05, 202X	SMA-0
	Amount due on 05-Apr-202X still not paid in full and the subsequent due amount also not paid	More than 30 days and upto 60 days	May 05, 202X	SMA-1
	Amount due on 05-Apr-202X still not paid in full and the subsequent due amount also not paid	More than 60 days and upto 90 days	June 04, 202X	SMA-2
	Amount due on 05-Apr-202X still not paid in full and the subsequent due amount also not paid	More than 90 days	July 04, 202X	NPA

Upgradation of Accounts classified as Non-Performing Asset (NPA):

The loan account classified as NPA can be upgraded as “Standard” only if the entire arrears of interest, principal and any other amount due are paid in full and there is NIL arrears upon running day end process of that calendar date.

For detailed guidelines on asset classification and provisioning, please refer to the RBI Master Direction – Reserve Bank of India (Non-Banking Financial Company – Scale Based Regulation) Directions, 2023 as amended. The above asset / SMA classification norms are subject to changes as per regulatory instructions issued from time to time.