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.
Did you find this helpful?
Yes
Still have questions?
How is interest calculated on my Pay Later (MTF) position if I have cash and/or pledged shares as margin
In which scenarios will the Pay Later position be liquidated?
What is pledging in Pay later (MTF) and what are the steps involved?
How can I check the interest that is being charged for my Pay Later(MTF) position?
Open Demat Account