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  • RM-2.9 RM-2.9 Refunds and Prepayments

    • Refund/Adjustment of Insurance Premium on Loan Prepayments and Top-Ups

      • RM-2.9.1

        Licensees must refund/adjust proportionately the insurance premium charged on individual loans/facilities when the borrower either requests for a top-up or prepayment of the loan/facility as per the prescribed formula below:

        Refund/Adjustment Amount = Remaining Period to Maturity X Premium Paid / Original Maturity
        July 2014

    • Early Repayment Fees/Charges

      • RM-2.9.2

        If early repayment charges are imposed by the licensee, the CBB imposes a ceiling on the early repayment charges on microfinance credit facilities as follows:

        (a) 1% of the outstanding credit facility amount or BD20 whichever is lower;
        (b) The ceilings on the charges have a retroactive effect i.e. covering existing and new credit facilities; and
        (c) Licensees must not charge any remaining interest/profit amount if prepayment is made.
        July 2014