In order to ensure its standards of transparency, in conformity with the stipulations of the RBI's directives, Cisco Systems Capital (India) Private Limited has adopted the following interest rate policy. This Policy applies to clients whose loans or advances are booked in Cisco Systems Capital (India) Private Limited.

The interest rate for the loans to be charged to the client/borrower will be decided keeping in view the RBI guidelines relating to regulation of excessive interest charged by NBFCs.

Interest rates would be intimated to the customers at the time of sanction / availing of the loan. The rates of interest for the same product and tenor availed during same period by different customers need not to be standardized, since Cisco Systems Capital (India) Pvt. Ltd. has adopted a risk-based approach for client classification for the purpose of determining applicable rate of interest, which differ for each client, primarily based on risk factors such as entity structure, industry, networth, leveraging, and nature of proposed loan.

Interest rate for each customer will be based on the following broad parameters:

• • Risk profile of the Customer
  • Interest rate trend prevailing in the money market
  • Cisco Capital India Cost of borrowings
  • Collateral security offered by Customer/ Structure of the deal
  
  
• The interest rates could be offered on fixed or variable basis
• Interest is calculated on the amount utilized by the Customer
• The interest could be charged on monthly or quarterly rests for different products/ segments.
• Besides normal interest, the company may levy additional / penal interest for delay or default in making payments of any dues. These additional or penal interests would be decided and communicated during the business agreement with the customer.
• No interest is payable on Advances/Excess payment made by Customer

The final lending rate for various products offered by Cisco Systems Capital (India) Private Limited will be arrived at after taking into account management reputation, company history, credit and default risk in the related business segment, historical performance of similar customer, profile of the borrower, tenure of relationship with the borrower, repayment track record of the borrower in case of existing customer, subventions available, deviations permitted, future potential, group strength, overall customer yield, nature and value of primary and collateral security, etc. Such information is gathered based on information provided by the borrower, credit reports, 3rd party agencies etc..

Classification for the purpose of determination of rate of interest can be summarized in below categories

1. Investment Grade Rating (Low Risk Category) – Companies with strongest financials and demonstrate a high likelihood of repayment. These companies would be mainly publicly traded companies (with exception of certain governmental, municipal and quasi-governmental agencies).
2. Non-Investment Grade (Medium Risk Category) – Companies with limited access to capital markets, and those small in size (based upon revenue and/or asset base), but are still financially viable entities fall under this category. Risk elements exist but near term performance is no concern OR performance is subject to economic or market uncertainties for the companies under this heading.
3. High Risk Accounts – Companies that are categorized in this credit rating are either very week, showing sign of financial deterioration, start-ups and recapitalizations or accounts downgraded to high risk during tenure of relationship. Companies with such ratings are not eligible for new financing (unless approved under special circumstances by CSCC investment Committee)

Indicative rate of interest applicable w.e.f. Feb 2012 to each category of client for loan denominated in Indian Rupees are as below: (Basis Points / per annum)

Above rate of interests are indicative and the management of the Company reserve right to change the same from time to time based on the market conditions and internal credit policies.