How is the interest charges calculated on Pay Later (MTF)?
Interest calculation is done on funded amount per share using the below formula from T+1 day onwards.
Funded amount Interest rate p.a. /365*
Example:- Mr. A wanted to Buy 100 shares of ABC limited trading @ Rs.1000. where KSEC is giving 5X leverage. MTF interest rate of Mr A is 9.69%.
Total Buy value | 100*1000 | Rs.1,00,000 |
Ksec Leverage | 5X | |
Margin required | 1,00,000/4 | Rs.20,000 |
KSEC funding | 1,00,000 - 20,000 | Rs.80,000 |
MTF interest rate | 9.69% | |
Interest charged per day | 80,000*9.69%/365 | Rs.21.24 per day |
Rs.21.24 is the per day interest that would be charged to the users on the funded amount.
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