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Consumer Affairs Act (Cap. 378) Consumer Credit Regulations, 2005 (L.N. 84 Of 2005 )

B 1027
CONSUMER AFFAIRS ACT (CAP. 378)
Consumer Credit Regulations, 2005
IN exercise of the powers conferred by article 7 of the Consumer Affairs Act, the Minister for Competitiveness and Communications, after consulting the Consumer Affairs Council, has made the following regulations>-
1. (1) The title of these regulations is the Consumer Credit
Regulations, 2005.
(2) These regulations shall come into force on such day as the Minister responsible for consumer affairs may by notice in the Gazette prescribe, provided that different dates may be prescribed for different provisions or purposes of these regulations.
2. (1) Any reference in these regulations to “the Act” is a reference to the Consumer Affairs Act, and subject to the provisions of sub-regulation (2) of this regulation, the provisions of article 2 of the Act shall apply to these regulations.

Citation and commencement.

Interpretation.

requires>
(2) In these regulations, unless the context otherwise
“annual percentage rate of charge” means the total cost of the credit to the consumer expressed as an annual percentage of the amount of the credit granted and calculated in accordance with regulation 6<
“creditor” means a trader who grants credit in the course of his trade, business, craft or profession or a group of such traders in connection with the supply of goods or services to consumers, or in connection with home loan agreements<
“credit agreement” means an agreement whereby a creditor grants or promises to grant to a consumer, credit in the form of a deferred payment, loan or other similar financial accommodation>
Provided that agreements for the provision on a continuing basis of a service or a utility whether private or public, where the consumer has the right to pay for them, for the duration of their
B 1028

Information

to be included in a credit agreement.

provision, by means of periodical payments, are not deemed to be credit agreements for the purpose of these regulations<
“credit intermediary” means a natural or legal person who, for a consideration, habitually acts as an intermediary by presenting or offering credit agreements<
“home loan agreement” means a credit agreement whereby the consumer may purchase, reconstruct, alter or improve immovable property for his own residence or that of his dependants and which is secured either by a hypothec or similar right or charge howsoever described on an immovable property, or by a surety<
“total cost of the credit to the consumer” means all the costs, including interest, commissions and any other kind of charge, howsoever described or to whomsoever it is paid, which the consumer has to pay for the credit.
3. (1) Credit agreements shall in all instances be made in writing and must be signed by the creditor and the consumer.
(2) The creditor shall be obliged to give the consumer a copy of such written agreement within a period of ten working days from the signing of the agreement.
(3) The written agreement shall include the following>
(a) a statement of the annual percentage rate of charge, together with a statement of the conditions under which the annual percentage rate of charge may be amended>
Provided that in cases where it is objectively impossible to state the annual percentage rate of charge, the consumer shall be provided with adequate information in the written agreement, including the particulars listed in sub-regulation (1) of regulation
4<
(b) a statement of the amount, number and frequency or dates of the payments which the consumer must make to repay the credit, the payments for interests or other charges, as well as the total amount of such payments<
(c) a statement of the cost items referred to in sub-regulation (2) of regulation 6, with the exception of expenditure related to the breach of contractual obligations which were not included in the calculation of the annual percentage rate of charge but which
have to be paid by the consumer in given circumstances together with a statement identifying such circumstances. Where the exact amount of those items is known, that sum is to be indicated< where the said exact amount is not known, either a method of calculation or as accurate an estimate as possible shall be provided.
(4) The written agreement shall further incorporate the other terms of the contract including all the terms stated in the First Schedule to these regulations.
4. (1) Notwithstanding the exclusion provided for in paragraph (e) of sub-regulation (1) of regulation 7, where an agreement between a credit institution and a consumer is being concluded for the granting of credit in the form of an advance on a current account other than on credit card accounts, the consumer shall, at the time or before the agreement is concluded, be informed in writing of the following matters>
(a) the credit limit, if any<
(b) the annual rate of interest and the charges applicable from the time the agreement is concluded and the conditions under which these may be amended<
(c) the procedure for terminating the agreement.
(2) During the period of the credit agreement, the consumer shall be informed of any change in the annual rate of interest or in the relevant charges at the time it occurs. Such information shall be given in a statement of account or by means of a press release or an advertisement or a notice which is displayed on the creditor’s business premises or in any other manner as the Director may establish by notice in the Gazette.
(3) In the case of tacitly permitted overdrafts where the overdraft extends beyond a period of three months, the consumer shall be informed in writing by the creditor of the annual rate of interest and any other charges that may be applicable.
5. (1) Prior to the conclusion of a home loan agreement, the creditor shall be obliged to provide the consumer with the general pre- contractual information listed in the Second Schedule to these regulations, together with a duly completed personalised standard information sheet in the format provided for in the Third Schedule to these regulations.
B 1029

Information

to be provided to consumer prior to or

during agreement.

Home loan

Agreements.

B 1030

Calculation of annual percentage

rate of charge.

(2) In any home loan agreement, the creditor shall be obliged to satisfy the following additional requirements relating to the form and content of such an agreement>
(a) the right of the consumer for a reduction under regulation
9 if he pays credit before it is due<
(b) a clear description of the security provided to the creditor<
(c) a clear indication of the costs payable by the consumer for an eventual breach of his contractual obligations under the agreement<
(d) a clear statement of the fees, if any, payable by the consumer for a home loan agreement in respect of the submission, approval or rejection of an application for such loan, the valuation of the security provided and the cost of legal services payable to the creditor in connection with the loan.
6. (1) The annual percentage rate of charge shall be that rate equivalent on an annual basis which equalises the present value of all commitments (loans, repayments and charges), future or existing, agreed by the creditor and the borrower, and shall be calculated in accordance with the mathematical formula set out in the Fourth Schedule to these regulations. By way of illustration, four examples of the method of calculation are provided in the Fifth Schedule to these regulations.
(2) For the purpose of calculating the annual percentage rate of charge and the “total cost of the credit to the consumer” as defined in regulation 2, no account shall be taken of the following charges or costs>
(a) charges payable by the consumer for non-compliance with any of his commitments laid down in the credit agreement<
(b) charges other than the purchase price which, in purchases of goods or services, the consumer is obliged to pay whether the transaction is paid in cash or by credit<
(c) charges for the transfer of funds and charges for keeping an account intended to receive payments towards the reimbursement of the credit, the payment of interest and other charges, except where the consumer does not have reasonable freedom of choice in the matter and where such charges are abnormally high>
Provided that this paragraph shall not apply to charges for the collection of such reimbursements or payments, whether made in cash or otherwise<
(d) membership subscriptions to associations or groups arising from agreements separate from the credit agreement, even though such subscriptions have an effect on the credit terms< and
(e) charges for insurance or guarantees>
Provided that any charges designed to ensure payment to the creditor, in the event of the death, invalidity, illness or unemployment of the consumer, of a sum equal to or less than the total amount of the credit together with relevant interest and other charges which have to be imposed by the creditor as a condition for credit being granted, shall be taken into account<
(f) in the case of home loan agreements, any charges payable by the consumer to persons other than the creditor<
(g) any charges which would become payable by the consumer to the creditor only when>
(i) the credit made available is not utilised in whole or in part<
(ii) the consumer requests an amendment to the rescheduling of payments and the creditor accedes to such a request< or
(iii) the consumer exercises his rights under regulation
9 hereof.
(3) The annual percentage rate of charge shall be calculated> (a) immediately prior to the conclusion of the credit
agreement, without prejudice to the provisions of regulation 11 concerning advertisements and special offers<
(b) on the assumption that the credit agreement is valid for the period agreed and that the creditor and the consumer fulfil their obligations under the terms and by the dates agreed.
(4) In the case of credit agreements containing clauses allowing variations in the rate of interest and the amount or level of other charges contained in the annual percentage rate of charge but
B 1031
B 1032

Non-applicability of regulations.

unquantifiable at the time when it is calculated, the annual percentage rate of charge shall be calculated on the assumption that interest and other charges remain fixed and shall apply until the end of the credit agreement.
(5) Where necessary, the following assumptions may be made in calculating the annual percentage rate of charge>
(a) if the contract does not specify a credit limit, the amount of credit granted shall be deemed to be eight hundred Maltese Liri or such other lesser amount as may be fixed by the Director after consulting the Council<
(b) if there is no fixed timetable for repayments, and such fixed timetable cannot be deduced from the terms of the agreement and from the means for repaying the credit granted, the duration of the credit shall be deemed to be one year<
(c) unless otherwise specified, where the contract provides for more than one repayment date, the credit will be made available and the repayments made at the earliest time provided for in the agreement.
7. (1) These regulations shall not apply to>
(a) hiring agreements except where these provide that the title will pass ultimately to the hirer<
(b) hiring agreements where the title will pass to the hirer solely at the discretion of the hirer<
(c) credit granted or made available without payment of interest or any other charge<
(d) credit agreements under which no interest is charged provided the consumer agrees to repay the credit in a single payment<
(e) credit in the form of advances on a current account granted by a credit institution other than on credit card accounts>
Provided that the provisions of regulation 4 shall in any case apply to such credits<
(f) home loan agreements where the amount exceeds eighty thousand (80,000) Maltese Liri<
(g) other credit agreements involving amounts of less than eighty-seven (87) Maltese Liri or more than eight thousand seven hundred (8,700) Maltese Liri <
(2) The Minister may, acting on the advice of the Director, by Order in the Gazette exempt from the application of these regulations certain types of credit which fulfil the following conditions>
(a) they are granted at rates of charge below those prevailing in the market< and
(b) they are not offered to the public generally.
8. (1) Where a creditor in a credit agreement relating to the supply of goods reserves the right to repossess the goods in the event of alleged default by the consumer, any such contractual repossession shall only be exercised if explicitly agreed to in writing by the consumer and any clause whereby the consumer exempts the creditor from the obligation to have recourse to judicial proceedings in order to effect such repossession or whereby the consumer otherwise renounces to his right to have recourse to judicial proceedings in respect of such repossession, shall be null and void>
Provided that, notwithstanding anything contained in the credit agreement, the court shall not allow the creditor to exercise the right to repossession where the consumer has already paid seventy per cent of the total amount of credit payable under the agreement or where it deems that the grant of such repossession would give rise to unjustified enrichment.
(2) When, in accordance with the other provisions of this regulation, a trader or a creditor, as the case may be, wishes to recover possession of any goods from a consumer as a result of an alleged breach of the credit agreement, he shall in the first instance send a notice by registered post to the consumer, at his last known address, specifying the following>
(a) details of the credit agreement<
(b) the full name and address of the creditor<
(c) the nature of the alleged breach of the agreement<
(d) information on the consequences should the consumer fail to comply with the request stated in the notice, and
B 1033

Repossession of goods.

B 1034

Right to pay credit before it is due.

Assignment of rights

and set-off.

Advertising.

(e) how and where the breach may be rectified, provided that the consumer shall in all cases be allowed at least fifteen days from the date of receipt of the notice to rectify the breach.
(3) Any attempt to take repossession of goods not in accordance with this regulation shall constitute a breach of these regulations.
(4) The provisions of this regulation shall apply even where the agreement under which a consumer acquires goods is described as a hire-purchase agreement or otherwise with reservation of ownership.
9. (1) The consumer shall be entitled to discharge his obligations under a credit agreement in full or in part before the time established by the agreement.
(2) If the consumer pays the credit before the time established by the agreement, he shall be entitled to a proportional reduction of the total cost of the credit.
(3) If costs directly arising from the credit agreement have been specified in the agreement and such costs are fair and reasonable taking into account all relevant circumstances, the creditor may recover such costs from a consumer who has exercised his right under sub- regulation (1)>
Provided that the creditor shall inform the consumer of the costs he would incur if early repayment is made>
Provided further that where such costs cannot be established when the credit agreement is signed, the creditor shall inform the consumer of the method of calculation to be used to establish such costs.
10. Where the rights of the creditor under a credit agreement are assigned to a third party, the consumer shall be entitled to raise against that third party any defence available to him against the original creditor>
Provided that set-off may only be raised in accordance with the relevant provisions of articles 1196 to 1204 of the Civil Code, which shall apply irrespective of anything to the contrary contained in a credit agreement.
11. Without prejudice to articles 48 to 50 of the Act, any advertisement or any offer displayed on any business premises in which a person offers credit or offers to arrange a credit agreement wherein a rate of interest or any figures relating to the cost of the credit are
indicated, shall also include a clear statement of the annual percentage rate of charge, at least by means of a representative example if no other means is practicable.
12. Without prejudice to the provisions of the Data Protection Act, personal data obtained from a consumer or any other person in connection with the conclusion and management of any credit agreement may only be processed for the purpose of assessing the financial situation of the consumer or of any such other person and their ability to repay.
13. (1) The credit agreement shall not prejudice the rights of the consumer against the trader who has supplied goods or services purchased by means of such an agreement where such goods or services are not supplied or are otherwise not in conformity with the contract for their supply entered into between the consumer and the trader.
(2) A consumer shall have the right to take action against the grantor of credit for the fulfilment of his claim where>
(a) in order to buy goods or obtain services the consumer enters into a credit agreement with a creditor other than the supplier of such goods or services<
(b) the grantor of the credit and the supplier of the goods or services have a pre-existing agreement whereunder credit is made exclusively by that grantor of credit to customers of that supplier for the acquisition of goods or services from that supplier<
(c) the consumer referred to in paragraph (a) obtains his credit pursuant to that pre-existing agreement<
(d) the goods or services covered by the credit agreement are not supplied, or are supplied only in part, or are not in conformity with the contract for their supply< and
(e) the consumer has pursued his remedies against the supplier but has failed to obtain the remedy to which he is entitled in whole or in part.
14. Every creditor shall take all necessary steps to ensure full compliance with these regulations.
15. A creditor or any other person shall not, with regard to a person who he knows, or ought to know from circumstances, to be under sixteen years of age, solicit any credit agreement or send him any
B 1035

Collection and processing of data.

Rights of

a consumer against a trader.

Responsibility of creditors.

Prohibition of marketing in relation to persons under sixteen.

B 1036

Enforcement, supervision and receipt of complaints.

Regulations to prevail.

Offences.

document by which credit or information or advice for the obtaining of credit is offered.
16. (1) The Director shall monitor the working and effectiveness of these regulations and shall undertake the necessary measures including, where appropriate, the initiation of legal proceedings to ensure compliance therewith.
(2) The Director shall monitor the granting of credit to consumers in connection with the supply of goods or services, and shall investigate complaints from consumers arising out of, or in connection with credit agreements, and he shall from time to time provide relevant information and advice to consumers in any manner he considers appropriate.
17. The provisions of these regulations shall prevail and apply notwithstanding anything to the contrary contained in any credit agreement, howsoever formulated or described, entered into by the consumer. Any waiver by the consumer of any of his rights under these regulations shall be null and void.
18. (1) Any person who contravenes or fails to comply with any of the provisions of these regulations shall be guilty of an offence against these regulations.
(2) Proceedings in respect of an offence against these regulations shall be commenced within one year from the commission of the offence.
(3) Any person guilty of an offence against these regulations shall, on conviction, be liable>
(a) in the case of the first conviction, to a fine (multa) of not less than two hundred (200) Maltese Liri and not exceeding one thousand (1,000) Maltese Liri<
(b) in the case of a second or subsequent conviction, to a fine (multa) of not less than four hundred (400) Maltese Liri and not exceeding two thousand (2,000) Maltese Liri< and the Court may in case of a second or subsequent conviction and in terms of article 107 of the Act, order the publication in one or more daily newspapers of any judgement, or a statement or summary thereof, passed on the offender>
Provided that the expenses of any such publication shall be at the expense of the person convicted in accordance with this regulation.
(4) Any proceedings undertaken under these regulations shall be without prejudice to the right of the consumer to undertake any action to seek compensation because of any loss or damages he may have incurred as a result of the breach of these regulations.
19. The purpose of these regulations is in part to transpose the provisions of Council Directive 87#102#EEC of 22 December, 1986, as amended by Council Directive 90#88#EEC and as further amended by Directive of the European Council 98#7#EC of 16 February, 1998, for the approximation of laws, regulations and administrative provisions of Member States concerning consumer credit, and these regulations shall be applied and interpreted accordingly.
B 1037

Scope and objective.

B 1038

Regulation 3(4)

1. In credit agreements for financing the supply of particular goods or services: (i) a description of the goods or services covered by the agreement;

(ii) the cash price and the price payable under the credit agreement;

(iii) the amount of the deposit, if any, the number and amount of instalments and the dates on which they fall due, or the method of ascertaining any of the same if unknown at the time the agreement is concluded;

(iv) an indication that the consumer shall be entitled, as provided in regulation 9, to a reduction if he repays early;

(v) who owns the goods (if tShCe HoEwDneUrsLhiEp 1does not pass immediately to the consumer) and the terms on which the consumer becomes the owner of such goods;

(vi) a description of the security required, if any;

(vii) the period, if any, during which a consumer may withdraw from a credit agreement without incurring any cost or penalty, however so described;

(viii) a clear indication of the insurance required, if any and, when the choice of insurer is not left to the consumer, a clear indication of the cost thereof; and

(ix) the obligation on the consumer to save a certain amount of money which must be placed in a special account.

2. In credit agreements operated by credit cards: (i) the amount of the credit limit, if any;

(ii) the terms of repayment or the means of determining them;

(iii) the period, if any, during which a consumer may withdraw from a credit agreement without incurring any cost or penalty, however so described.

3. In credit agreements operated by running account which are not otherwise covered by these regulations:

(i) the amount of the credit limit, if any, or the method of determining it; (ii) the terms of use and repayment ;

(iii) the period, if any, during which a consumer may withdraw from a credit agreement without incurring any cost or penalty, however so described.

4. In other credit agreements covered by these regulations:

B 1039

(i) the amount of the credit limit, if any;

(ii) an indication of the security required, if any; (iii) the terms of repayment;

(iv) the period, if any, during which a consumer may withdraw from a credit agreement without incurring any cost or penalty, however so described;

(v) an indication that the consumer shall be entitled, as provided in regulation 9, to a reduction if he repays early.

B 1040

Regulation 5(1)

Initial information about home loans should include or be accompanied by the following information in the same format as that initial information is itself provided:

A – Creditor:

(i) Identification and address of the creditor;

(ii) Where appropriate, identification and address of the intermediary.

B – Home Loan:

(i) Purposes for which the home loan may be used; (ii) Form of surety;

(iii) Description of the types of home loans available with short description of the differences between fixed and variable rate products, including related implications for the consumer;

(iv) Types of interest rate – fixed, variable, and combinations thereof; (v) An indication of the cost of a typical home loan for the consumer;

(vi) A list of related cost elements, such as administrative costs, insurance costs, legal costs, the costs of intermediaries;

(vii) The different options available for reimbursing the credit to the creditor, including the number, frequency, amount of repayment (instalments if any);

(viii) Whether there is a possibility of early repayment (if so, its conditions);

(ix) Whether a valuation of the property is necessary and, if so, by whom it has to be carried out;

(x) General information on tax relief on home loan interest or other public subsidies prevailing, or information on where one can obtain further advice;

(xi) The duration of the period, if any, during which a consumer may withdraw from a credit agreement without incurring any cost or penalty, however so described.

B 1041

Regulation 5 (1)

The contents of the Standardised information sheet are set out below.

STANDARDISED INFORMATION SHEET

B 1042

B 1043

Regulation 6(1)

BASIC CALCULATION EXPRESSING THE EQUIVALENCE OF LOANS ON THE ONE HAND AND REPAYMENT INSTALMENTS AND CHARGES ON THE OTHER:

K m

K

K m

K

tK tK

K 1 1 i

K 1 1 i

Where:

K The serial number of a loan.

K ' The serial number of a repayment installment or a payment of charges.

AK The amount of loan number K .

A' K '

The amount of repayment installment or payment of charge number K '

The symbol for the sum.

m The serial number of the last loan.

m' The serial number of the last repayment installment or payment of charges.

t K The interval, expressed in years and fractions of a year, between the date of granting of loan no. 1 and the date of granting of the subsequent loans nos. 2 to m .

t K '

The interval, expressed in years and fractions of a year, between the date of granting of loan no. 1 and the date of payment of the repayment installment or charge nos. 1 to m' .

i The percentage rate that can be calculated (either by algebra, by successive approximations, or by a computer programme) where the other terms in the equation are known from the credit agreement or otherwise.

(a) The amounts paid by both parties at different times shall not necessarily be equal and shall not necessarily be paid at equal intervals.

(b) The starting date shall be that of the first loan.

B 1044

(c) Intervals between dates used in the calculations shall be expressed in years or in fractions of a year. The year shall be considered as having 365 days or 365.25 days or (for the leap years) 366 days, 52 weeks or 12 equal months. An equal month shall be considered as having 30.41666 days (namely 365/12).

(d) The results shall be expressed with an accuracy of at least one decimal place.

When rounding to a particular decimal place the following rule shall apply:

If the value of the decimal place figure following this particular decimal place is greater than or equal to 5, the figure of such particular decimal place shall be increased by one.

B 1045

Regulation 6(1)

EXAMPLES OF CALCULATIONS

A. CALCULATION OF THE ANNUAL PERCENTAGE RATE OF CHARGE ON A CALENDAR BASIS [1 YEAR = 365 DAYS (OR 366 DAYS FOR LEAP YEARS)].

Sum loaned: S = 1 000 Maltese Liri on 1st January, 1994.

The sum is repaid in a single installment of 1200 Maltese Liri on 1st July , 1995, that is 1½

years or 546 (=365 + 181) days after the date of the loan.

The equation becomes:

1000

1200

546

1 i 365

or:

1 i 546 365

1 i

1.2

1.1296204

i 0.1296204

This amount shall be rounded to 13% (or 12.96% if an accuracy of two decimal places is preferred).

The sum loaned is S = 1000 Maltese Liri, but the creditor retains 50 Maltese Liri for administrative expenses.

So that the real loan is 950 Maltese Liri.

The repayment of 1200 Maltese Liri, as in the first example, is again made on the 1st July,

1995.

The equation becomes:

950

1200

546

1 i 356

Or:

B 1046

This amount shall be rounded to 16.9%

The sum loaned is S = 1000 Maltese Liri, on the 1st January, 1994, repayable in two installments of 600 Maltese Liri paid after one and two years respectively.

The equation becomes:

1000

600

600

600

600

1 i 1

730

i 365

1 i 2

The equation is solved by algebra and produces i = 0.1306623 rounded to 13.1% (or 13.07%

if an accuracy of two decimal places is preferred).

The sum loaned is S = 1000 Maltese Liri, on 1st January, 1994 and the amounts paid by the borrower are:

After 3 months (0.25 years/90 days): 272 Maltese Liri After 6 months (0.5 years/181 days): 272 Maltese Liri After 12 months (1 year/365 days): 544 Maltese Liri

The equation becomes:

1000

272

90

272

181

544

365

1 i 365

1 i 365

1 i 365

The equation allows i to be calculated by successive approximations which can be programmed on a calculator.

The result is i=0.13226 rounded to 13.2% (or 13.23% if an accuracy of two decimal places is preferred).

B 1047

Sum loaned S = 1000 Maltese Liri

This sum is repaid in a single instalment of 1200 Maltese Liri in 1.5 years (that is 1.5 x 365 =

547.5 days, 1.5 x 365.25 = 547.875 days, 1.5 x 366 = 549 days, 1.5 x 12 = 18 months or 1.5 x

52 = 78 weeks) after the date of the loan.

The equation becomes:

1200

1200

1200

1200

1000

547.5

1 i 365

547.875

1 i 365. 25

18

1 i 12

78

1 i 52

or:

1 i 1. 5

1.2

1 i 1.129243

i 0.129243

This amount shall be rounded to 12.9% (or 12.92% if an accuracy of two decimal places preferred).

The sum loaned is S = 1000 Maltese Liri, but the creditor retains 50 Maltese Liri for administrative expenses. So that the real loan is 950 Maltese Liri. The repayment 1200

Maltese Liri, as in the first example, is made 1.5 years after the date of the loan.

The equation becomes:

950

1200

547.5

1200

547. 875

1200

18

1200

78

1 i 365

1 i 365.25

1 i 12

1 i 52

or:

This amount shall be rounded to 16.9% (or 16.85% if an accuracy of two decimal places is preferred).

B 1048

The sum loaned is S = 1000 Maltese Liri and is repaid in two instalments of 600 Maltese Liri paid after one and two years, respectively.

The equation becomes:

1000

600

365

600

730

600

365.25

600

730. 5

1 i 365

1 i 365

1 i 365.25

1 i 365.25

600

12

600

24

600

52

600

104

1 i 12

1 i 12

1 i 52

1 i 52

600

600

1 i 1

1 i 2

The equation is solved by algebra and produces i = 0.13066 rounded to 13.1% (or 13.07% if an accuracy of two decimal places is preferred).

The sum loaned is S = 1000 Maltese Liri and the amounts paid by the creditor are: After 3 months

(0.25 years/13 weeks/91.25 days/91.3125 days) 272 Maltese Liri

After 6 months

(0.5 years/26 weeks/182.5 days/182.625 days) 272 Maltese Liri

After 12 months

(1 year/52weeks/365 days/365.25 days) 544 Maltese Liri

TOTAL 1088 Maltese Liri

The equation becomes:

1000

272

91. 25

272

182.5

544

365

1 i 365

1 i 365

1 i 365

272

91. 3125

272

182. 625

544

365.25

1 i 365. 25

1 i 365. 25

1 i 365.25

272

3

272

6

544

12

1 i 12

272

13

1 i 12

272

26

1 i 12

544

52

1 i 52

272

1 i 52

272

1 i 52

544

1 i 0.25

1 i 0.5

1 i 1

B 1049

This equation allows i to be calculated by successive approximations, which can be programmed on a calculator.

The result is i=0.13185 rounded to 13.2% (or 13.19% if an accuracy of two decimal places is preferred).