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Penal Charges Calculator
See what your bank's own flat penal charge comes to under RBI's 2024 regime, vs. the old compounding penal-interest system.
RBI sets no fixed percentage for penal charges -- each bank fixes its own charges via board-approved policy (RBI only requires they be “reasonable”, not compounded, and not used as a revenue tool). Enter your own bank’s disclosed rate from the loan agreement/sanction letter below.
Optional, for comparison only:
Per the RBI circular “Fair Lending Practice – Penal Charges in Loan Accounts” (Aug 2023, rollout completed by 1 Apr/30 Jun 2024) now consolidated into the RBI (Commercial Banks – Responsible Business Conduct) Directions, 2025: penalties must be a flat, one-time, non-compounding “penal charge”, not the old compounding “penal interest”. Does not apply to ECB/trade-credit/foreign-currency export credit facilities. Credit cards run under a separate, different RBI regime (late-payment charges on the overdue amount only) and are not covered by this calculator.
This is a working aid to help you estimate faster -- not legal, accounting or credit-sanctioning advice, and not a substitute for your bank’s own policy, sanction terms, or the official RBI source. Always confirm the exact current figures on rbi.org.in before relying on any number here.