The interest rate on a loan is calculated based on the nominal interest rate, and the annual interest rate shows how much the loan will cost you if you pay interest on other payments on time. You can see the procedure for calculating the actual annual interest rate below.

The annual interest rate is calculated using the following formula:

• i - annual percentage rate (APR)
• A - the loan amount (the initial amount of the loan provided by the lender to the consumer)
• n - the number of payments to repay the loan
• N - the number of the last loan payment
• Kn - the amount of the n-th loan payment
• Dn - the period from the date of issuance of the loan to the day of payment of the n-th loan payment, expressed in the number of days

More details can be found at this link:  8/01

Prior to the conclusion of the loan agreement, the organization issues an Individual Sheet in accordance with Regulation 8/05, approved by the Board of the Central Bank of the Republic of Armenia “Procedure for communication between the bank and the depositor, creditor and consumer, terms, conditions and minimum requirements”.