Service Loan

A small amount as an office management cost or overhead expenses is taken from the borrower when they seek cash loan or service loan only and when banks do not find any alternative than of cash loan.

A well-known Islamic scholar having specific knowledge about Islamic banking and finance has given permission to charge office management costs as income for the financial institution to manage office costs like salary and other expenses of the bank.

Types of Service Loan

  1. 1Month Service Loan
  2. 3Months Service Loan
  3. 6Months Service Loan
  4. 9Months Service Loan
  5. 12Months Service Loan

When a borrower applies for a service loan for the amount 1,00,000 in Sarokar Saving & Credit Co-operative Society Limited Harinagar Sunsari then he or she is first asked about the type of loan on the basis of duration as stated in types of service loan section above.

If the borrower asks 1,00,000 for one month service loan he is charge one hundred as an application charge and five hundred as file charge and one thousand five hundred as office management cost for a month in advance. If the borrower repays the due 1,00,000 within a month then the total loan amount is considered as cleared completely.

But if he becomes unable to pay the principle then he needs to renew the first procedure once more and he is once more charged as one hundred as loan renewal application and one thousand five hundred as office management cost for the running month. In case of default, the borrower is charged some penalty as fine charge and the penalty amount is deposited in Qarde Ahsan Fund which helps the fund to increase. It should be noted that the filing charge is taken once in a year only.

If the borrower asks 1,00,000 the loan for three months then he is charge one hundred as an application charge and five hundred as file charge and four thousand five hundred as office management cost for three months in advance. If he/she repays the due 1,00,000 within ninety-seven days (7 days given as grace days) then the total loan amount is considered as cleared completely.

But if he becomes unable to pay the principle within 97 days then he needs to renew the first procedure once more and will be charged one hundred as loan renewal application and four thousand five hundred as office management cost for the next three months. In case of default, the borrower is charged some penalty as fine charge and the penalty amount is deposited in Qarde Ahsan Fund which helps the fund to increase. It should be noted that the filing charge is taken once in a year only.

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