Interest plans

Pismo Control Center enables you to define interest plans and attach them to your operations on the Pismo platform. An interest plan is a configuration that defines how interest is calculated and applied to a specific product or account. This can include the interest rate, the compounding period (for example, daily, monthly, or quarterly), tax implications, and more. The plan can be tailored to the specific needs of a product or service, allowing for a wide range of interest-based financial solutions.

An interest plan can be one of two types:

• Fixed interest rate—This is an interest rate on a loan or investment that remains the same for the entire term or a specified part of the term.
• Floating interest rate—Sometimes called a variable or adjustable interest rate, this is a rate of interest that can change over the term of a loan or investment. It typically is based on a benchmark interest rate or market index that changes periodically, such as the U.S. Prime Rate or the London Interbank Offered Rate (LIBOR). In addition to the benchmark rate, the floating interest rate on a loan should also include a margin that is kept constant. For example, if the benchmark rate is 3 percent and the margin is 2 percent, the interest rate would be 5 percent. If the benchmark rate rises to 4 percent, the interest rate would adjust to 6 percent.

To view the list of interest plans, go to the main menu and select Configurations > Interest plans. Select any plan to view its details.

For information about interest plans on the Pismo platform, refer to Interest-bearing accounts.