* Clients are applicaple for Tawasol loan (Additional Supporting loan for existing clients) as per the following:

     - Minimum Loan Amount: 100 JOD     

     - Maximum Loan Amount: 25% of the Basic loan amount and maximum 500 JOD

     - Fixed monthly interest Rate: 2%

      - Loan Term: 6-12 Months

* 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 800 loan for the third time from Tamweelcom, with a tenor of 12 months at a declining intrest rate/annual of 31.7% and which is equivalent to fixed interest rate/annual of 18%.

1. What is the total interest rate paid for the loan?

Total interest rate for the loan = 144 JOD

Stamps duty on the Contract = 2 JOD

Fees = 1 JOD

One-time commission for credit granting = 8 JOD

2. What is the monthly payment for the loan (principal, interest and sales tax on interest)?

 First month payment amount: 79.32 JOD (Principal 57.562 JOD, interest 21.125 JOD and sales tax on interest 0.633 JOD)

The remaining monthly payments amount: 79 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: (represents the expected income): enter 0

IRR = 0.02951

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) = 41.758%