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Green Finance (Fixed Income)

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LOAN_AMOUNT : 500 – 4,000 JOD

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Grace Period : Not applicable

Payment Date

Payment Date : 1st of each month

Loan Term

Loan Term : 3 - 36 Months (according to loan amount)

One-time commission for credit granting

One-time commission for credit granting : 1% of granting credit for the loans less than 1,000 JOD, and 1%+10 JOD of granting credit for the loans amount between 1,000-10,000 JOD

Late payment commission

Late payment commission : 0.25JOD/day for monthly payment less than 50 JOD, 0.5JOD\day for monthly payment between 50-200 JOD, 1JOD\day for monthly payment between 200-400 JOD

Annual interest rate

Annual interest rate:

In collaboration with partners suppliers: 0% For details click here

Other Suppliers declining interest rate/annual of 21.816% which is equivalent to fixed interest rate/annual of 12%

- Declining interest rate is indicative; the rate depends on the tenor of the loan.

Loan Purposes

Loan Purposes : Financing fixed assets for energy-saving appliances or technologies, using alternative energy (such as solar panels, solar heaters, energy-saving electrical appliances, etc.)

Insurance Solutions

Insurance Solutions : Customers' lives are insured through Sanad or Aman - upon the customer's request - in accordance with the terms and conditions of the services provided.

* All kind of loans are subject to Stamps Fees Law and Sales Tax Law.

* Includes all persons as long as they are in full legal capacity and in line with the company’s policy and provisions.

* The company is obliged to grant funding only for legal purposes, and the fund is not granted for any kind of illegal purposes or purposes that entail environmental and social impact.

*Terms and conditions apply.

*The company is an insurance agent for the Jordanian Insurance Company and its registration number with the Central Bank of Jordan is 0022/01/5/20.

A customer obtained financing of BHD 980 from the company to purchase goods from a non-accredited supplier, with a repayment term of 18 months at a reducing annual interest rate of 21.795% (equivalent to a flat annual interest rate of 12%).

1. What is the total interest accrued on the financing?

Total interest value on financing = 176.400 JOD, plus 3% sales tax

The value of import stamps on the contract = 2 JOD

The value of the commission for granting one-time credit = 9.8 JOD, plus 3% sales tax

Other services: “Sanad” insurance service upon customer request, subject to the company’s terms and conditions = 2.5 JOD per month

2. What is the value of the monthly installment that must be paid (principal, interest, and sales tax on the interest)

The value of the monthly installment for the first payment: 76.192 JOD

The value of the monthly installment for the remaining payments: 66.500 JOD, including the principal, interest, and sales tax on the interest.

3. How to calculate the effective interest rate (EIR) for the loan

The effective interest rate (EIR) = (1+IRR)12 - 1

The Internal rate of return (IRR) calculated using Microsoft Excel by using the equation of IRR:

Value field: enter all the cash flows (plus and minus)

Guess field: (represents the expected income): enter 0

IRR = 0.02812

Which represent the Monthly Effective rate

The effective interest rate (EIR) calculated by substitute the IRR in the following equation:

The effective interest rate (EIR) = (1+IRR)12 - 1

The effective interest rate (EIR) = 32.791%

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