Cost of the Loan

Interest Rates

Kafalat Innovative guaranteed loans may only be granted in Lebanese Pounds. The loan will be charged the following interest rate:

Interest rate = 40% of the 1 year Lebanese Treasury Bills Yield (TBY’s) + 3%

Subsidy

The interest subsidy is the same for all subsidized loans, currently at 4.5%. The duration of the subsidy will cover the whole duration of a Kafalat Innovative loan guarantee.

Kafalat Fee

The Kafalat fee consists of a 2.5% yearly commission of the outstanding value of the guarantee. The value of the guarantee is 90% of the loan value approved by the bank and Kafalat.

Fiscal stamps are charged once on the Letter of Guarantee and are calculated at 0.3% of the value of the guarantee.

Therefore, the final cost at Letter of Guarantee issuance would be equal to:

[(Loan Value + interest accrued during grace period + interest accrued for 3 months) x 90% x 2.5%) + [(Loan Value + interest accrued during grace period + interest accrued for 3 months) x 90% x 0.3%]

Additional Fees

One time file fee may be charged by bank (maximum 400,000 Lebanese Pounds).