# How does PeerPower calculate interest and fees ?

Modified on Fri, 08 Sep 2023 at 05:20 PM

Interest and fees on PeerPower platform are calculated based on the actual number of borrowing days. The investor fee is 1.25% per year of the remaining principal balance.

Calculation of interest:

Interest = outstanding balance x (interest rate per year / 365) x number of days since the lastest payment date to the present payment date.

`In the event that the issuer delays their repayment, investors will receive late interest calculated with the number of days since the repayment was delayed and repayment amount of that installment.`

Calculation of late interest payment:

Late interest = payment amount for that installment x (interest rate per year / 365) x number of delayed payment day

For example:

Investment amount (THB): 100,000 THB

Interest rate (per year): 10%

- Period: 120 days (with repayment due every 30 days)

Repayment type:  amortization repayment, 25,000 THB per installment

If the issuer postpone to repayment their first installment, from January 30, 2023 to February 4, 2023

Interest: 100,000 x (10% / 365) x 30 = 821.92 THB

- Late interest (5 days) : 25,000 x (10% / 365) x 5 = 34.25 THB

The return amount that investors will receive (before deducting investor fee) is 856.17 THB

Calculation of troubled debt restructured interest:
Interest = outstanding balance × (interest rate per year + 1.5%) / 365 × number of days since the latest payment date to the present payment date.

Calculation of investor fee:

Investor fee = outstanding balance x (investor fee / 365) x number of days since the latest payment date to the present.

For example:

Outstanding Balance: 150,000 THB

- Investor fee per year: 1.25%

- The latest payment date January 13, 2023 - the next payment date February 13, 2023 : 31 days

Investor fee: 150,000 x (1.25% / 365) x 31 = 159.34 THB

`Remark: The system calculates with 2 decimal places (in case of calculation using Excel: round, 2).` 