Demonstration of Borrowing Cost
Understanding the true cost of borrowing from non-bank financial institutions.
Understanding Total Borrowing Cost
The Bank of Zambia requires all NBFIs to clearly disclose the total cost of borrowing to customers. This includes the interest rate, fees, insurance, and any other charges. The Annual Percentage Rate (APR) reflects the true cost of a loan over one year.
Borrowing Cost Calculator
Cost Components
Interest Charges
The cost of borrowing money, calculated as a percentage of the principal amount over the loan period.
Processing Fee
A one-time fee charged for processing the loan application, usually a percentage of the loan amount.
Insurance Premium
Credit life insurance or loan protection insurance that covers the loan in case of death or disability.
Other Fees
May include administration fees, late payment penalties, and early repayment charges.