Housing Finance

An equated monthly instalment (EMI) is a fixed payment amount that borrowers make to lenders on a specified date each month. EMIs are applied to both interest and principal each month so that, over a specified period of time, the loan is paid off in full.

EMI repayment typically commences from the month following the month in which the full loan amount is disbursed. However, some lenders may offer a grace period before EMI repayment begins.

EMIs are a convenient way for borrowers to repay their loans, as they allow borrowers to budget for their monthly loan payments in advance. Additionally, EMIs can help borrowers stay on track with their loan repayments and avoid defaulting on their loans.

Here is an example of how an EMI is calculated:

EMI = (Loan Amount X Monthly Interest Rate X (1 + Monthly Interest Rate)^Loan Tenure in Months) / ((1 + Interest Rate)^Loan Tenure in Months - 1)

For example, if a borrower takes out a loan of ₹ 25 lakhs at an interest rate of 8% per annum for a period of 10 years, their monthly EMI would be ₹ 30,347.

Loan amount: ₹ 25 lakhs

Interest rate: 8% per annum

Loan term: 10 years

Step 1: Convert the interest rate to a monthly rate.

Monthly interest rate = Annual interest rate / 12 / 100

Monthly interest rate = 8 / 12 / 100 = 0.00667

Step 2: Calculate the exponential factor.

Exponential factor = (1 + Monthly interest rate)^Loan tenure in months

Exponential factor = (1 + 0.00667)^120 = 2.21964

Step 3: Calculate the EMI.

EMI = (Loan amount * Monthly interest rate * Exponential factor) / (Exponential factor - 1)

EMI = (2500000 * 0.00667 * 2.21964) / (2.21964 - 1)

EMI = 30,347

Therefore, the monthly EMI for the loan is ₹ 30,347.

ABHFL complies with a variety of rules and regulations, including:

• The Companies Act, 2013

• The Securities and Exchange Board of India (SEBI) (Listing Obligations and Disclosure Requirements) Regulations, 2015

• The National Housing Bank (NHB) Housing Finance Companies (Regulation and Supervision) Act, 1992

• The Reserve Bank of India (RBI) Guidelines on Fair Practices Code for Non-Banking Financial Companies (NBFCs)

• The RBI Guidelines on Prudential Framework for Housing Finance Companies (HFCs)

• The RBI Guidelines on Know Your Customer (KYC) and Anti-Money Laundering (AML)

ABHFL also has its own corporate governance code, which is aligned with the best practices recommended by the Securities and Exchange Board of India (SEBI) and the National Housing Bank (NHB).

The ABHFL corporate governance code includes provisions for the following:

• The composition and role of the board of directors

• The role of the audit committee, nomination committee, and risk management committee

• The company's policies on conflict of interest, insider trading, and corporate social responsibility

ABHFL is committed to following all applicable rules and regulations and to maintaining the highest standards of corporate governance. This commitment is essential to building trust with its customers and stakeholders and to ensuring the long-term success of the company.

In addition to the above, ABHFL also complies with all other relevant laws and regulations, such as the Real Estate (Regulation and Development) Act, 2016, and the Insolvency and Bankruptcy Code, 2016.