Interest calculation on delayed payments for msme vendors

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This query is : Resolved

Aarushi (Querist)

29 August 2019 Hi,

I need to understand how to compute interest on delayed payments to MSME vendor . Please provide example. Also what is rate of interest on delayed payments to MSME

CS M Pota

CS M Pota (Expert)

31 August 2019 As per the guidelines for delayed payment of dues to the MSE borrowers If the buyer fails to make payment of the amount to the supplier, he shall be liable to pay compound interest with monthly rests to the supplier on the amount from the appointed day or, on the date agreed on, at three times of the Bank Rate notified by Reserve Bank.

As per my view the interest is to be calculated on the amount for which supply is already made or services already provided by payment is not made and due.

saurendra rautray

saurendra rautray (Expert)

10 June 2020 Hi ,
The calculation is to be based on the prevailing bank rate on the day of interest to be calculate as mentioned above 3 times compounded at monthly rest .
Regards
Saurendra Rautray
Rautray &co
Advocate
New Delhi
www.rautray.com
9437008255

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