An individual retail loan designed to financing vocational and technical education of youth students at Joramco Academy by financing the students or their parents.
Voice over for Education finance - Joramco
Loan Amount : 20,000 JOD (maximum client’s total debt balance)
Grace Period : Not applicable
Payment Date : 1st of each month
Loan Term : 6 - 120 Months (according to loan amount)
Fees : 0 JOD
Penalties : 0.5 JOD per each day of delay
Annual interest rate:
Interest rate of (0%) during study period.
Interest rate of (1%) monthly on remaining loan balance after graduation and in case of completing payments after student’s graduation.
Loan Purposes : Financing the fees and tuition for joining the internationally-approved Joramco Academy program for vocational and technical training in maintenance, repair, and overhaul of commercial aircraft
Added Value Services : Aman: free service where the outstanding balance of the client's loan is paid in case of the death of client and in case of disability according to the approved disability schedule
* 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.
A client received a JOD 2,500 loan from Tamweelcom, with a tenor of 20 months and at a declining interest rate/annual of 0% which is equivalent to fixed interest rate/annual of 0%.
1- What is the total interest rate paid for the loan?
Total interest rate for the loan = 0 JOD
Stamps duty on the Contract = 9 JOD
2- What is the monthly payment for the loan (principal, interest and sales tax on interest)?
First month payment amount: 125 JOD (Principal 125 JOD, interest 0 JOD and sales tax on interest 0 JOD)
The remaining monthly payments amount: 125 JOD (Including principal payment, interest and sales tax on 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: (represent the expected income) enter 0
IRR = 0.00034
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) = 0.413%
