Common use of Penal Interest Clause in Contracts

Penal Interest. In default of regular payment of Interest / EMI / Repayment Amounts / Outstanding Amounts on the due dates as per the Repayment Schedule, Penal Interest at the rate as specified in Schedule I over and above the Applicable Rate of Interest shall become payable on monies due from the date of default up to the date of actual payment. Such obligation to pay the Penal Interest shall arise without the need for any notice thereof or demand therefore.