Interest conditions
The interest conditions parameters define the rules set for loan interest calculation.
Interest conditions parameters
Base*
List
Select the principal base. The possible values:
balance,
balance and debt.
Interest type*
List
Select the interest rate type. The possible values:
fixed,
floating.
Apply global cap
Checkbox
Select to apply the interest global cap.
Interest rate cap*
List
Select the interest rate cap type. Note: this parameter is available only if the apply global cap checkbox is selected.
Adjust margin according to cap
Checkbox
Select this checkbox to adjust the margin according to the interest cap. Note: this parameter is available only if the apply global cap checkbox is selected.
Days in year*
List
Select the type of the day-count convention used for calculating the scheduled interest amounts and the daily accrued interest. Predefined list options:
ACT/360 (actual number of days in a month and 360 days in a year),
ACT/365,
30/365,
30/360.
Reference rate*
List
Select the reference rate. It specifies which reference rate is used.
Note: this parameter is available if the Interest type = Floating.
Negative rate handling*
List
Select the negative rate handling. It specifies the way how the system handles the negative reference rate. The predefined values are:
The negative base rate is changed to 0. If the reference rate value equals to or is smaller than 0, it is equated with 0. Only the contract margin rate is used for interest calculation.
The negative base rate is used, but the total cannot be negative. Thus, regardless of the reference rate value, it is used for interest calculation, but with the restriction that the total reference rate and the contract margin rate cannot be below 0.
Note: this parameter is available if the If Interest type = Floating.
Penalty
Checkbox
Select the checkbox if you want to add the penalty to the principal. Note: that the penalty has a standard setup. To learn more about penalty configuration, see the penalty section.
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