As a percentage of the base rate

Configuring margin type and default margin rate

Let's assume you would like the effective rate to be 60% of the base rate. Then, you should make the following configuration selection:

  • Select the margin type value percentage of the base rate that is subtracted from the base rate,

  • Set the default margin rate value to 40% (100% - 40% = 60%).

If the base rate value is 5%, then the applied effective rate will be 3%.

It calculates 5 - (0.4 * 5) = 5 - 2 = 3.

Adding min and max margins

Minimum and maximum margin rates act as boundaries for manual adjustments to the effective rate of one particular account. Let's assume you want to restrict the manual adjustment of the effective rate to a maximum of 80% and a minimum of 40% of the base rate. Then, you should set:

  • Min margin rate to 20% (100% - 80% = 20%),

  • Max margin rate to 60% (100% - 60% = 40%).

If the base rate value is 5%, then the highest applied interest rate can be 4% and the lowest 2%.

They calculate respectively 5 - (0.2 * 5) = 5 - 1 = 4 and 5 - (0.6 * 5) = 5 - 3 = 2.

The feature to manually adjust the account's floating interest rate margin will be available in future releases.

PreviousApplying floating interestNextAs a difference from the base rate

Last updated

Was this helpful?