With Pismo Control Center you can 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.

There are two types of interest plans:

• 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).

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.

Add a fixed interest rate plan

To add a fixed-rate interest plan:

1. From the main menu, select Configurations > Interest plans.
2. On the Interest plans screen, select Create.
3. On the Select an interest plan type screen, select Fixed rate and select Next.
4. On the Fixed rate plan details screen, enter a descriptive name for the plan in the Name field.
5. Select the Currency code menu and then choose the currency to be used.
6. The accrual basis is the method used to calculate the interest accrual. Select one of the following accrual basis options:
   • Actual/360 (or Act/360)—Interest rate is divided by 360 and then multiplied by the actual number of days that the capital is borrowed.
   • Actual/365 (or Act/365)—Interest rate is divided by 365 and then multiplying it by the actual number of days that the capital is borrowed.
   • Actual/Actual—This method is somewhat more complex as it involves taking into account the actual number of days in the relevant year. If the time period spans two different years, the interest is calculated separately for each year.
   • BD/252—This option is often used in the Brazilian market. It takes into account only the number of business days in a year, which is typically 252. The interest rate is divided by 252 and then multiplied by the actual number of business days that the capital is borrowed.
7. Select the interest type:
   • Simple
   • Compound
8. Select the capitalization frequency:
   • Daily
   • Monthly
   • Quarterly
   • Half yearly
   • Yearly
9. Select the accrual frequency:
   • Daily
   • Monthly
   • Quarterly
   • Half yearly
   • Yearly
10. In the Fixed interest rate field, enter the interest rate and select Next.
11. On the Associate processing code screen, select one of the following options:
    • Do not associate—Do not associate this interest plan with a processing code.
    • Associate—Associate this interest plan with a processing code.
      You can associate this interest plan with a processing code to create your financial setup. This association is optional, define what makes sense for your business plan.
12. Select Next.
13. On the Review screen, verify that the information you provided is correct, then select Finish.

Add a floating interest rate plan

To add a floating-rate interest plan:

1. From the main menu, select Configurations > Interest plans.
2. On the Interest Plans screen, select Create.
3. On the Select an interest plan type screen, select Floating rate and select Next.
4. On the Floating rate plan details screen, enter a descriptive name for the plan in the Name field.
5. Open the Currency code menu and then choose the currency to be used.
6. The accrual basis is the method used to calculate the interest accrual. Select one of the following accrual basis options:
   • Actual/360 (or Act/360)—Interest rate is divided by 360 and then multiplied by the actual number of days that the capital is borrowed.
   • Actual/365 (or Act/365)—Interest rate is divided by 365 and then multiplied by the actual number of days that the capital is borrowed.
   • Actual/Actual—This complex method takes into account the actual number of days in the relevant year. If the time period spans two different years, the interest is calculated separately for each year.
   • BD/252—This option is often used in the Brazilian market. It takes into account only the number of business days in a year, which is typically 252. The interest rate is divided by 252 and then multiplied by the actual number of business days that the capital is borrowed.
7. Select the interest type:
   • Simple
   • Compound
8. Select the capitalization frequency:
   • Daily
   • Monthly
   • Quarterly
   • Half yearly
   • Yearly
9. Select the accrual frequency:
   • Daily
   • Monthly
   • Quarterly
   • Half yearly
   • Yearly
10. Select the benchmark index used to measure the interest a value has over time.
    • BOE—Bank of England, UK
    • DI—Interbank Deposit Contract – Brazil
    • FED—Federal Reserve System – USA
    • RBA—Reserve Bank of Australia
    • RBI—Reserve Bank of India
11. In the Margin rate field, enter the fixed percentage to add to the benchmark rate to calculate the total interest rate. For example, if the benchmark rate is the DI, and the margin rate is 110%, then the interest rate is 110% of the DI rate.
12. (Optional) In the Margin field, enter the additional rate clients earn on investments or deposits, above the benchmark rate. Enter the margin as a whole number (1 for 1%, not 0.01). For example, if the benchmark rate is 3% and you apply a 2% margin, the interest rate becomes 5%. If the benchmark rate rises to 4%, with the same margin, the interest rate adjusts to 6%. After you enter the margin, select Next.
13. On the Attach processing code screen, select one of the following options:
    • Do not attach—Do not attach this interest plan to a processing code.
    • Attach—Attach this interest plan to one or more processing codes.
      If you are attaching more than one processing code, choose the Select button for each one.
14. Select Next.
15. On the Review screen, verify that the information you provided is correct and select Finish.