Before you sign for a loan, your lender must give you a short, standard document called the Key Facts Statement, or KFS. It shows the real cost of the loan: the interest rate, every fee, and one all-in yearly figure called the APR. Many borrowers never read it. This guide explains RBI's KFS rules as of October 2026 and gives you a simple checklist.
What is a Key Facts Statement (KFS)?
A KFS is a statement of the key facts of your loan agreement, in simple language and in a standard format set by RBI. RBI's circular of 15 April 2024 made one common KFS format compulsory. RBI said the aim is to improve transparency and reduce the information gap between lenders and borrowers.
The KFS must include:
- the APR (Annual Percentage Rate), which is the yearly cost of the loan including interest and all other charges,
- an APR computation sheet that shows how the APR was worked out, and
- a repayment schedule (also called an amortisation schedule) for the full tenure, showing each instalment.
The KFS also appears as a summary box in your loan agreement.
Which loans and lenders must give a KFS?
- Lenders: all commercial banks, including small finance banks, local area banks and regional rural banks (but not payments banks). Also primary (urban) co-operative banks, state and central co-operative banks, and all NBFCs, including housing finance companies.
- Loans: all retail and MSME term loans sanctioned on or after 1 October 2024, including fresh loans to existing customers.
- Not covered: credit card dues.
So for a home loan, personal loan, car loan, education loan, loan against property or MSME term loan sanctioned since 1 October 2024, you should have received a KFS.
Since November 2025, RBI has been replacing many older circulars with consolidated Directions for each type of lender. For commercial banks, one of these is the Responsible Business Conduct Directions, 2025. The KFS rules may now sit in such Directions, so for the exact current wording, check the latest directions that apply to your lender.
When must the lender give you the KFS?
- Before you sign the loan contract.
- In a language you understand. The lender must explain its contents and take your acknowledgement that you have understood it.
- With a validity period. Each KFS has a unique proposal number. For loans of 7 days or more, it must stay valid for at least 3 working days (at least 1 working day for shorter loans). If you accept within that time, the lender is bound by those terms.
Those three working days are your time to compare. Ask two or three lenders for a KFS on the same amount and tenure, and put them side by side.
What should you check in your KFS?
| Item | What to check |
|---|---|
| Loan amount and amount paid to you | If fees are deducted upfront, you receive less than the loan amount but repay all of it. |
| Interest rate and type | Fixed or floating. For a floating rate, confirm in the sanction letter which benchmark it follows (such as RBI's repo rate) and the spread, which is the margin added on top. |
| Fees and charges | Processing, legal, valuation and other fees, each listed. |
| Third-party charges | Insurance or legal charges the lender collects for others must be shown separately. They count in the APR, and you should get receipts. |
| APR | The best single number for comparing offers. It is usually higher than the interest rate. |
| Repayment schedule | Number of EMIs (equated monthly instalments), the EMI amount and the interest and principal in each. |
| Penal charges | RBI's penal charges rules require their amount and the reason to be disclosed in the KFS and loan agreement. |
| Prepayment charges | For floating-rate loans to individuals for non-business purposes, sanctioned or renewed from 1 January 2026, RBI's pre-payment charges rules allow no pre-payment charge. For fixed-rate loans, the lender's disclosed policy applies. |
Can the lender charge you something that is not in the KFS?
Not without your agreement. RBI says that fees or charges not mentioned in the KFS cannot be charged at any stage of the loan without your explicit consent. So keep your KFS safe. If a new charge appears in your statement later, compare it with the KFS and ask the lender in writing where you agreed to it.
Worked example: what the KFS tells you that the rate does not
Say a lender offers a personal loan of ₹5,00,000 at 12% a year for 36 months. The EMI formula is EMI = P × r × (1 + r)^n ÷ [(1 + r)^n − 1]. Here P is the loan, r is the monthly rate (12 ÷ 12 ÷ 100 = 0.01) and n is the number of months. The EMI is ₹16,607.
Now say the KFS also shows a processing fee of ₹11,800 including GST, and an insurance premium of ₹8,000 collected by the lender. Both are deducted upfront, so you receive ₹4,80,200 but repay EMIs on ₹5,00,000.
- Interest over 36 months: about ₹97,858
- Interest plus fee plus premium: about ₹1,17,658
- APR: about 14.83%, compared with the 12% interest rate
The headline rate says 12%. The APR shows the loan really costs nearly 15% a year. A lender may calculate APR in a slightly different way from our simple method, so its figure may differ a little. The computation sheet in your KFS is the figure that counts.
What about loans from apps and the cooling-off period?
For digital loans, taken through an app or website, RBI's rules give a cooling-off or look-up period. During it, you can exit the loan by paying back the principal and the proportionate APR, with no penalty. Each lender's board sets the period, but it must be at least one day. After it ends, prepayment follows the normal rules. Check your loan terms for the length of this period.
What if you did not get a KFS?
- Do not sign until you have it. Ask for it in writing.
- If you already have the loan, ask the lender for a copy of the KFS and the summary box in your agreement.
- Complain to the lender first. Keep the date and reference number.
- Then RBI. Under the RBI Integrated Ombudsman Scheme, 2026, if the lender does not reply within 30 days or you are unhappy with the reply, you can complain free at cms.rbi.org.in.
Do it in 10 minutes, free
Got two KFS documents? Enter both offers in the LowerMyEMI compare offers calculator to see which costs less overall, including fees. Export it to Excel or PDF.
Already have a loan? LowerMyEMI can write a ready letter asking your own bank for a lower rate, and one email per lender asking them to send their offer, with a KFS, for a balance transfer. You send them from your own email. We are not a lender and never promise a rate; lenders decide.