GlossaryCredit
Nominal rate
Short definition
Gross interest rate applied to borrowed capital, without considering ancillary fees.
Detailed definition
Nominal rate is gross interest rate bank bills you on borrowed capital, expressed as annual percentage. Does NOT include file fees, death insurance, possible commissions. That's why it appears lower than APR. Useful to calculate interest but not for objective comparison of two offers.
Concrete example
Consumer credit 50,000 MAD nominal rate 6% over 3 years: total interest ≈ 4,800 MAD. If APR 6.8%, total cost ≈ 5,400 MAD (600 MAD fees/insurance added).
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