* All kind of loans are subject to Stamps Fees Law and Sales Tax Law.

* Includes all persons as long as they are in full legal capacity and in line with the company’s policy and provisions.

* The company is obliged to grant funding only for legal purposes, and the fund is not granted for any kind of illegal purposes or purposes that entail environmental and social impact.

*Terms and conditions apply.

*The company is an insurance agent for the Jordanian Insurance Company and its registration number with the Central Bank of Jordan is 0022/01/5/20.

A non-dependent customer obtained financing worth 975 JOD from Tamweelcom Company, with the financing being repaid over 18 months with a decreasing/annual interest rate of 21.684%, which is equivalent to a fixed/annual interest rate of 12%.

1. What is the total interest accrued on the financing?

Total interest value on financing = 175.50 JOD, plus 3% sales tax

The value of import stamps on the contract = 2 JOD

The value of the commission for granting one-time credit = 9.75 JOD, plus 3% sales tax

2. What is the value of the monthly installment that must be paid (principal, interest, and sales tax on the interest)

The value of the monthly installment for the first payment: 69,265 JOD

The value of the monthly installment for the remaining payments: 65.50 JOD, including the principal, interest, and sales tax on the interest.

3. How to calculate the effective interest rate (EIR) for the loan

The effective interest rate (EIR) = (1+IRR)¹² - 1

The Internal rate of return (IRR) calculated using Microsoft Excel by using the equation of IRR:

Value field: enter all the cash flows (plus and minus)

Guess field: (represents the expected income): enter 0

IRR = 0.02812

Which represent the Monthly Effective rate

The effective interest rate (EIR) calculated by substitute the IRR in the following equation:

The effective interest rate (EIR) = (1+IRR)¹² - 1

The effective interest rate (EIR) = 32.164%