My informant tells me: The advanced amount is less than the loan amount. For a loan of Rs 10,000, the financer will advance Rs 9000. Then he will recoup the principal plus interest amounting to Rs 10,000 (Rs 9000 principal +Rs 1000 interest) over the period of 100 days at Rs 100 per day. The Rs 1000 interest on a borrowing of Rs 9000 for 100 days works out to a rate of xxx% p.a.

For a loan of Rs 1000, the interest is Rs 100 over 100 days.

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