Calculation of interest on loan to directors

It is totally depend on loan agreement thats whats interest rate there mentioned.

Normally interest rate is quarterly calculated. You can take the interest rate of SBI. and it should be entered quarterly and if expeected interest amount is cross the limit of 5000 in a F.Y., then you have to deduct the TDS at the time of crediting the interest amount to director loan. and it will be paid within seven days of following month. if not then 1% (if tds not deducted, as your case), 1.5% (if deducted but not paid) per month will be there.