💰Interest Payments

There are 3 different payment types, decided by the lender:

• interest + principal every term Lender requests the borrower pays both the interest and principal each term of the loan. The borrow can over pay, but must pay the minimum requirement each term otherwise your collateral will be at risk of liquidation if you are late on the payment.

• interest every term Lender has requested just interest each term, with the principal being paid in one complete payment at the end. Again over payments can be made, but your collateral will be at risk of liquidation if you are late on the payment.

• everything at the end Lender only requires both interest and principal to be paid on completion of the loan.

Principal payments do not reduce interest, but can be used to reduce the required collateral (or increase the provided collateral %).

Loan durations are a multiple of 30-day terms (1 term), with a maximum of 300 days (10 terms). Before the end of every term of 30 days, borrowers need to pay the due share of interest to the lender. If a borrower does not pay their due share in time, their loan can be liquidated as described previously.

The amount of interest to be paid each term is the total interest to be paid, divided by the amount of terms of the loan. Interest can be paid in advance.

For example, a loan of $10,000, to be paid in 3 terms (90 days), with a 10% interest rate, will receive $1,000 of interest by the end of these 90 days.

At the end of term 1, a borrower needs to make the minimum payment ($333). As long as the minimum payment at the end of each term has been paid, the loan is not at risk of liquidation. The borrower can over pay at any time to keep ahead of the minimum required.

Some examples of possible interest payments for this loan:

Providing at least the minimum amount of interest due by the payment date is covered, the loan interest is deemed on track. But you can overpay at any point, as shown in the graphic above. The value of the interest paid is determined at the time of payment. If an instalment paid in e.g. ‘ARB’ was worth $300 at the time of payment, but a day later it is worth $200 or $400, the borrower still needs to pay the remainder of $600 by the end of the loan, as was determined at the time of payment.

Interest payments can be made at any point in time, and multiple times per term.

Loan Repayments

Providing a loan has not been liquidated, a loan is considered to be repaid if and only if:

- The total borrowed value has been paid back to the lender - The total interest due has been paid to the lender

As soon as a loan is considered to be repaid, the collateral is freed up and becomes usable deposit for the borrower again.

Not repaying a loan before the end of the terms can lead to liquidation, as is the case with insufficient interest payments and principal payments for each instalment.