Unlike in the case of conventional financial institutions, it is not Lenbor but the Lender who decides how much return they want to earn. Interest rate agreements are entirely between lenders and borrowers across the platform in which Lenbor has no intervention. We recommend that investment should be spread such that returns are a weighted average of the individual loan parts. This is explained through an illustration below.

For example, on a loan of Rs. 150,000 spread across 3 borrowers, for a period of 1 year at various interest rates; the returns can be as follows:

BORROWER AMOUNT LENT RATE INTEREST EARNING
Mr X Rs. 50,000 12% p.a.  Rs.3,309
Mr Y Rs. 50,000 16% p.a.  Rs.4,439
Mr Z Rs. 50,000 20% p.a.  Rs.5,581
Total Rs. 1,50,000 16% p.a.  Rs.13,329

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As can be seen in the example above the lender is earning on an average 16% interest on total investment. Also, Interest earnings can be more or less depending on loan amount split across interest rates. For e.g the lender may decide to lend only Rs. 20,000/- @ 12% and increase the amount to Rs. 60,000/- @ 16% and to Rs. 70,000/- @ 20%. This will increase the lender’s average return. At Lenbor, what amount to lend at what interest rate is controlled by the lender depending on his/her judgment and negotiating skills.

Non-Payment Of EMI
Though we do our best to manage the risk at every step, defaults may happen. In such a scenario, Lenbor will facilitate the collection through our in-house collection mechanism and also send a legal notice on behalf of the lender to the borrower. Expenses incurred for sending legal notices, by recovery agency and towards other legal proceedings are borne by the lender.

Registration Fees
A non-refundable, one-time registration fee of Rs. 1000/- is payable by the lender to Lenbor at the time of Sign Up.

Transaction Fees
A non-refundable 1% transaction fee from retail investors and 2% from institutional investors is charged on the loan amount disbursed. This is deducted from the first EMI.

Other Fees
Lender(s) are obliged to maintain details of their loan including statement of accounts. In case, they need Lenbor’s assistance in this regard then a non-refundable fee of Rs. 500/- per statement of accounts will be charged.

Len-bor.com only facilitates a virtual meeting place between Borrowers and Lenders on its online platform. The decision to lend money to a borrower is entirely at the discretion of the Lenders and Lenbor does not guarantee that a borrower will receive any loans from the Lenders. Lenbor merely aids and assists Lenders and Borrowers listed on its website to make and receive loans and charges a service fee from Lenders and Borrowers for such assistance. Lenbor is only an ‘Intermediary’ under the provisions of the Information Technology Act, 1999.