The Fine Print
What the rules on borrowing in India actually say, in plain English, with the source for every claim and the date we last checked it.
How to read this section
Everything here is verified context, not fiction and not advice. Quoted words are taken from Reserve Bank of India documents. In November 2025 RBI folded thousands of older circulars into consolidated Directions, so we cite those, and name the original circular where it helps. Rules change: each page shows when its sources were last opened, and says plainly what we could not confirm.
What the rules require
APR and the Key Facts Statement
Before a retail term loan, the lender must hand you one page with the real yearly cost, every fee included, and cannot later charge a fee that is not on it.
3 sources, last checked 10 November 2026
Instant-loan apps: what the rules require
A loan through an app is still a loan from a regulated lender, and the money, the data and the complaints all have rules.
3 sources, last checked 10 November 2026
Pay-later, cards and no-cost EMI
On a bank credit card, a no-cost EMI must show its principal, its interest and the discount that cancels it. Away from cards, the picture is less clear.
2 sources, last checked 10 November 2026
Missed payments and penal charges
A lender can charge a penalty for a late instalment, but it must be a stated charge, not a higher interest rate, and it cannot itself earn interest.
3 sources, last checked 10 November 2026
Collections and recovery conduct
Lenders may ask for their money. They and their agents may not intimidate, humiliate, or call at all hours, and your family and contacts are protected too.
3 sources, last checked 10 November 2026
Prepayment and foreclosure charges
On a floating-rate loan taken by an individual for non-business purposes, lenders may not charge for early repayment. Fixed-rate loans are different.
3 sources, last checked 10 November 2026
Complaints and the RBI Ombudsman
Complain to the lender in writing first. If 30 days pass without a satisfactory answer, the RBI Ombudsman is free and takes complaints online.
2 sources, last checked 10 November 2026
Credit reports and your rights
You can see your full credit report free once a year from each bureau, you must be told when a lender checks it, and slow corrections earn compensation.
2 sources, last checked 10 November 2026
Microfinance loans
A microfinance loan is a collateral-free loan to a low-income household, with a cap on total repayments and its own, stricter conduct rules.
3 sources, last checked 10 November 2026
How the money works
The mechanics behind the rules, from our guides and glossary.
- How EMI is calculated
The formula, with a worked example.
- Flat rate vs reducing balance
Why the same number means two different costs.
- EMI vs no-cost EMI
Where the interest goes when none is shown.
- Monthly affordability vs total cost
A longer tenure lowers the EMI and raises the bill.
- Prepayment
What paying early does to interest and tenure.
- Foreclosure
Closing a loan in full before its term.
- Missing an EMI
What typically follows a late instalment.
- Processing fees
The charge that never appears in the rate.
- Credit scores
What the number summarises.
- The full glossary
Twenty terms, each with an example.
The research notes behind this section, including everything we failed to verify, are kept with the site's source code. Found a rule that has changed? Tell us.