How is interest calculated on my outstanding MTF amount?

Interest rates applicable for MTF trades are as follows:

Day	Interest (%)
From T+1 day till 15th day	6.99 % p.a
From 16th day	18% p.a

* 6.99% interest is applicable for squaring off position within 15 days. If the position is not squared off within this period, an interest rate of 18% p.a. will be charged from T+1 day onward & thereafter.

The MTF facility provides investors with a flexible interest payment structure. Since interest is charged on a daily basis, cash balances available in your trading account are also taken into consideration to arrive at the outstanding amount on which interest is calculated. So if you have funds in excess of the minimum margin requirement in your trading account, it will be taken into account to determine interest dues for the day. This will reduce the charges applicable to your MTF position. These funds will not be blocked and can be used for regular trades (only the minimum requirement will be blocked).

For Example:

Mr. Suraj takes a position in Tata Steel shares on January 1 for ₹1,00,000 using his pledge collaterals. Since no cash payment is made, the debit of ₹1,00,000 remains in his account.

Scenario 1: Sale on January 10

Settlement Day: January 2 (T+1 day).

Interest Rate: 6.99% p.a. (charged daily).

Interest Period: January 2 to January 10 (9 days).

Interest Calculation (per day):

₹1,00,000 × (6.99% ÷ 365) = ₹19.15/day.

Total Interest: ₹19.15 × 9 = ₹172.35.

Interest for this period is calculated daily but posted to the ledger at the end of the month. The accrued interest can be viewed in the MTF Statement sent via email or in the MTF tab of MyGeojit.

Scenario 2: Sale on January 20

Settlement Day: January 2 (T+1 day).

Interest Rate: 6.99% p.a. from January 2 to January 15 (14 days).

18% p.a. applies for the entire period, adjusted for the differential (18% - 6.99%) for the first 15 days.

Interest Posting Details: 6.99% Interest (January 2 to January 15):

₹1,00,000 × (6.99% ÷ 365) × 14 = ₹268.10.

Additional Interest for January 2 to January 15 (18%- 6.99%):

Difference in interest: (18% - 6.99%) ÷ 365 = ₹30.14/day.

Total adjustment: ₹30.14 × 14 = ₹421.96.

18% Interest (January 16 to January 20):

₹1,00,000 × (18% ÷ 365) × 5 = ₹246.58.

Total Interest (January 2 to January 20): ₹268.10 (6.99% interest) + ₹421.96 (adjustment -18% - 6.99%) + ₹246.58 (18% interest) = ₹936.64.

Note: Interest for the entire period is calculated daily but posted to the ledger at the end of the month. Customers can view the accrued interest details in their MTF Statement (sent via email) or in the MTF tab of MyGeojit.

Margin requirements vary scripwise and are subject to periodic changes. Check the current list of MTF eligible shares and their margin requirements.

Geojit will be debiting MTF booked loss for the month to your normal ledger on the last day of the month if there is no credit balance available in the MTF cash ledger. This is to prevent interest accumulation in the MTF book and to collect the booked loss on a regular basis.

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