What Are the Fees and Charges Associated with a Flexi Loan?

Like most loans, flexi loans come with some standard fees. These usually cover:

• Interest Rates: You must pay interest on the loan amount you borrow at rates agreed upon with the financial institution. Interest rates on flexi loans vary across financial institutions but are generally higher than those on other loans.
• Processing Fee: When you take a flexi loan, the financial institution usually charges a one-time, upfront processing fee to cover the expenses of processing and setting up the loan. The fee amount varies between loan providers.
• Pre-payment Penalties: Some financial institutions charge a penalty fee if you choose to foreclose or prepay more than a predefined portion of your flexi loan ahead of the initially agreed tenure. This helps cover any losses the loan provider may incur from the early withdrawal of funds.
• Late Payment Fees: Late fees may apply if you miss paying your Equated Monthly Instalment (EMI) by the deadline. These fees can pile up if you default repeatedly over several months.
• Other Charges: Additional charges, such as those for loan renewal, loan cancellation requests, document processing, bounced checks, etc., may also apply as per the conditions predefined in your loan agreement.