APR
Also called Annual percentage rate
Annual percentage rate: a loan's full yearly cost, counting interest and all other charges.
APR, or annual percentage rate, is the single best number for comparing loans. It wraps interest and charges like the processing fee into one yearly figure, so a loan with a lower headline rate but bigger fees can’t hide its cost. Find it in the Key Fact Statement.
Questions people ask
What is the full form of APR?
APR stands for annual percentage rate. RBI describes it as the annual cost of credit to the borrower, including the interest rate and all other charges on the loan.
How is APR different from the interest rate?
The interest rate counts only interest. APR adds the fees, such as the processing fee, so it shows the true yearly cost. Two loans with the same interest rate can have different APRs.
Where do I find a loan's APR?
In the Key Fact Statement. Since October 2024, RBI requires retail term loans to come with a KFS that includes an APR calculation.
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