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Every loan price should reflect its risk. At a leading Indian private sector bank, that calculation lived in Excel, with every relationship manager running their own version. Pricing varied across branches, approvals happened over email and there was no automatic check against regulatory rate floors. MXTechies replaced it with a Mendix RAROC Calculator that prices every proposal the same way, routes it to the right approver and records every decision.
A RAROC calculator works out a loan’s risk-adjusted return on capital so it can be priced correctly. In this project, the solution automates risk-adjusted return on capital (RAROC) pricing for credit proposals. The app calculates RAROC in real time at facility, borrower and group level using centrally governed rate parameters, checks proposed interest rates against RBI benchmarks, routes each proposal to the correct approval authority based on its RAROC value, and keeps a full audit trail.
- Client
- A leading Indian private sector bank
- What is RAROC?
- Risk-adjusted return on capital: the return a loan earns after accounting for its risk and the capital it uses
- Platform
- Mendix web application
- Calculation levels
- Facility, borrower and group
- Governance
- Central master data owned by the risk team, authority-based approvals, RBI rate checks
- Delivered by
- MXTechies, Mendix Certified Partner and Siemens Certified Partner
The challenge
Credit pricing depended on spreadsheets and offline approvals, which caused five problems:
- Many versions of the truth: each relationship manager kept their own Excel template, so pricing differed across branches.
- Ungoverned rates: cost of funds, operating cost, credit risk and capital inputs had no central owner, so every change meant updating many files.
- Offline approvals: proposals were approved by email and physical sign-off, with no status view.
- No limit enforcement: nothing stopped a proposal going to someone without the authority to approve it.
- No regulatory check: there was no automatic test that a proposed rate met RBI’s regulatory floor before submission.
The solution
MXTechies developed a centralised, web-based RAROC Calculator on Mendix that automates the end-to-end credit pricing process. Excel workings are gone.
The risk team maintains all rate parameters in one master data module, and every proposal uses them automatically. A digital approval workflow sends each proposal to the right authority level based on its computed RAROC, and built-in validation checks the proposed rate against RBI benchmarks before it can be submitted.
Key features
01Real-time RAROC calculation
- For the bank
- Returns are computed instantly at facility, borrower and group level.
02Central master data
- For the bank
- The risk team updates cost of funds, operating cost, credit risk and capital inputs once.
03Authority-based approval routing
- For the bank
- Proposals reach the right approver automatically, enforcing delegation limits.
04RBI rate validation
- For the bank
- Proposed rates are checked against regulatory benchmarks before submission.
05Proposal status tracking
- For the bank
- Relationship managers see where each proposal stands.
06Complete audit trail
- For the bank
- Every pricing decision is logged for compliance and review.
How it works
- EnterThe relationship manager enters the credit proposal in the app.
- CalculateRAROC is computed in real time using the central rate parameters.
- ValidateThe proposed interest rate is checked against RBI benchmarks.
- RouteThe proposal goes to the approval authority that matches its RAROC value.
- ApproveThe approver reviews and decides inside the workflow.
- RecordThe decision and all inputs are stored in the audit trail.
Read more about our work for banks and financial services and how we set up Mendix governance.
Outcomes
- Consistent pricing: every branch prices with the same logic and the same rates.
- Central control: rate changes are made once by the risk team and apply everywhere.
- Enforced authority limits: proposals can’t bypass the right approver.
- Regulatory confidence: rates are checked against RBI benchmarks before submission.
- Audit-ready: every decision has a full, searchable record.
Why build this on Mendix
- Central rules, consistent results: Mendix keeps rate parameters and pricing logic in one governed app instead of many spreadsheets.
- Approvals built in: authority-based routing and audit trails come with the platform.
- Easy to update: the risk team changes parameters without new development.
Who this is for
Banks, NBFCs and lenders that price corporate or retail credit using spreadsheets, need tighter control over pricing parameters, or want approval limits and regulatory checks enforced automatically.
Frequently asked questions
What is a RAROC calculator?
It calculates risk-adjusted return on capital for a loan, showing whether the price covers the risk and the capital the loan consumes.
At what levels does the app calculate RAROC?
At facility, borrower and group levels, in real time.
Who controls the rate parameters?
The bank’s risk team maintains them in a central master data module, and every proposal uses them automatically.
How are approvals handled?
A digital workflow routes each proposal to the correct authority level based on its computed RAROC, enforcing delegation limits.
Does the app check regulatory requirements?
Yes. It validates proposed interest rates against RBI benchmarks before a proposal can be submitted.
About MXTechies
MXTechies is a Mendix Certified Partner and Siemens Certified Partner with delivery teams in India, the USA and the UAE. We build enterprise apps on Mendix, the low-code platform from Siemens, for manufacturing, banking, real estate and retail. See more of our case studies.
Last updated October 2026
Price every loan right, every time.
One pricing engine. One set of rates. Zero rogue spreadsheets.