I run Securis, which means I’ve read more loan term sheets than almost anyone I know — ours and everyone else’s. And the thing that still surprises me is how many smart, careful people sign one without knowing which numbers on it actually matter. They read the headline interest rate, glance at the EMI, and skip the rest. That’s exactly backwards. The headline rate is often the least honest number on the page, and two or three of the numbers people skip are where the real money hides.
So here’s the practitioner’s version — the five numbers I’d check on any personal-loan term sheet before I signed, in the order I’d check them. This applies whether the loan is from us or from anyone else. If it makes our own term sheet easier to interrogate, good; a borrower who understands what they’re signing is a borrower we keep.
First, one piece of housekeeping. Every RBI-regulated lender — bank or NBFC — has to give you a Key Fact Statement (KFS) before you sign. It’s a one- or two-page summary that puts the numbers below in a standard format, so you don’t have to dig through the full agreement. If you’re handed a term sheet without a KFS, ask for it. It exists to protect you, and reading it is the single highest-return five minutes in the whole process.
1. The APR — not the quoted rate
The number a salesperson leads with is often a “flat rate,” and a flat rate is designed to sound small. The number that actually tells you the cost is the APR (annual percentage rate), which is on the KFS by law.
Here’s why the difference matters, with real math. Take a common ask: ₹85,000 over 18 months.
A term sheet advertising “12% flat” charges interest on the full ₹85,000 for the entire tenure — even though you’re paying the principal down every month. That’s ₹15,300 in interest, a total of ₹1,00,300, and an EMI of about ₹5,572. Sounds cheap. It isn’t. Converted to an honest APR, that “12% flat” is roughly 21.6% per annum.
Now compare a loan quoted at 16% APR (reducing balance, the way Securis and every KFS express it). Interest works out to about ₹11,170, total payback ₹96,170, EMI about ₹5,343.
So the loan advertised as “12%” costs you about ₹4,130 more than the one advertised as “16%.” The bigger-sounding number is the cheaper loan. Whenever you see a small “flat” rate, mentally multiply it by roughly 1.8 for these tenures to get somewhere near the real APR — then compare on APR only.
2. The processing fee — because it shrinks what you receive
The second number is the processing fee, usually 1–3% of the loan, plus GST. It rarely changes the EMI, so people wave it off. But it changes what actually lands in your account.
On our ₹85,000 example, a 2% processing fee is ₹1,700. If it’s deducted upfront, you receive about ₹83,300 — but your EMI is still calculated on the full ₹85,000. You’re paying interest on money you never got to use. That’s not a scandal; it’s how the product works. But it does mean the fee is part of the price, not a footnote. Add it to your total-cost math, and if you’re comparing two term sheets with the same APR, the one with the lower processing fee wins.
Working out whether a small loan makes sense for you? Apply for a Securis loan — you’ll see your full Key Fact Statement, APR and all fees before you commit anything. Typical disbursement is 1–2 working days.
3. Total amount payable — the one number that ends every argument
The third number is the simplest and the most powerful: total amount payable over the life of the loan (EMI × number of months, plus fees). It’s on the KFS.
I like this number because it can’t be dressed up. A longer tenure lowers your EMI, which feels like a discount, but it almost always raises the total you pay. On our ₹85,000 at 16% APR, going from 18 months to 30 months drops the EMI to around ₹3,450 — comfortable — but pushes total interest up by roughly ₹7,000. Neither is “wrong.” A lower EMI you can reliably pay beats a higher one you’ll struggle with. But make that trade with your eyes open, using the total-payable figure, not the EMI alone.
4. Foreclosure and prepayment charges — what it costs to leave early
The fourth number decides how trapped you are. Students and early-career borrowers often clear these small loans ahead of schedule — a bonus, an internship stipend, a parent stepping in — so the cost of prepaying matters more than for most.
Good news here comes from the regulator: on floating-rate personal loans to individuals, RBI has removed foreclosure and prepayment penalties, which is a consumer-protection rule working squarely in your favour. On fixed-rate loans, some lenders still levy a foreclosure charge, so check the term sheet: look for the prepayment and foreclosure line, note whether it’s a flat fee or a percentage of the outstanding, and confirm whether there’s a lock-in period before you’re even allowed to prepay. If you expect to close early, a loan with zero foreclosure charges can be worth a slightly higher headline rate.
5. Penal charges — the number you hope never to use
The last number is the penal charge for a late or missed EMI. You’re not planning to miss one, but you should still know what a slip costs. RBI now requires these to be a reasonable, clearly disclosed “penal charge” rather than compounding penalty interest stacked on top of your rate — another rule built to protect borrowers from small mistakes snowballing. Read the figure, note the grace period if any, and make sure the term sheet also names the grievance/complaint officer. A term sheet that tells you exactly who to call when something goes wrong is a good sign about the lender.
When you can skip most of this
If you’re borrowing a genuinely small amount over a short tenure — say ₹20,000 over six months — the gaps between term sheets get small, and obsessing over a 1% APR difference isn’t worth your afternoon. Just confirm the APR is in a sane range, the processing fee isn’t outlandish, and there’s no ugly foreclosure lock-in. Similarly, if you’re looking at ₹5,00,000+ for full tuition, a personal loan is the wrong product entirely — that’s a job for your bank’s education-loan desk, where the rates and tenures are built for that size. This five-number checklist is aimed at the ₹25K–₹2L range where a personal loan genuinely fits.
The whole point is this: a term sheet isn’t trying to trick you, but it isn’t trying to help you compare either. These five numbers — APR, processing fee, total payable, foreclosure terms, and penal charges — are the ones that decide what you actually pay. Read them in that order and you’ll never be surprised by a loan again.
If you want a second opinion on your specific situation, WhatsApp us — we’ll be honest about whether Securis fits.