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updatedAt: 2026-03-20T19:57:11.000Z
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# Overdue tolerance

By default, an account becomes overdue if the minimum amount due (MAD) is not paid by the due date. The **overdue tolerance** feature enables you to set up additional rules that tell the Pismo platform to ignore overdue amounts if they fall within a tolerance range. In other words, if the overdue amount is within a specific range, the platform does not consider the account to be overdue, and overdue charges are not applied.

To configure overdue tolerance, set the following program parameters.

<Table align={["left","left"]}>
  <thead>
    <tr>
      <th>
        Parameter name
      </th>

      <th>
        Definition
      </th>
    </tr>
  </thead>

  <tbody>
    <tr>
      <td>
        **Overdue tolerance percentage**
      </td>

      <td>
        A percentage of the overdue amount that is used by the **Overdue tolerance method** to determine if the account should be considered overdue. Must be greater than 0 and less than or equal to 100.
      </td>
    </tr>

    <tr>
      <td>
        **Overdue tolerance amount**
      </td>

      <td>
        A fixed amount that is used by the **Overdue tolerance method** to determine if the account should be considered overdue. For example, $70.
      </td>
    </tr>

    <tr>
      <td>
        **Overdue tolerance method**
      </td>

      <td>
        The method to apply:

        * *0* — Do not use.
        * *1* — Maximum value. Between the **Overdue tolerance amount** and (MAD x **Overdue tolerance percentage**), use whichever value is greater. If the difference between the payment and the overdue amount is less than or equal to this value, the account is not considered overdue.
        * *2* — Minimum  value. Between the **Overdue tolerance amount** and (MAD x **Overdue tolerance percentage**), use whichever value is lower. If the difference between the payment and the overdue amount is less than or equal to this value, the account is not considered overdue.
      </td>
    </tr>
  </tbody>
</Table>

# Examples

## Example 1

Suppose you set the program parameters as follows.

| Parameter name                   | Value       |
| :------------------------------- | :---------- |
| **Overdue tolerance percentage** | 10%         |
| **Overdue tolerance amount**     | $70         |
| **Overdue tolerance method**     | 1 (Maximum) |

Suppose that:

* Minimum amount due (MAD) is $100.
* A payment is made of $80.
* Payment is received after the due date.

The overdue amount is:\
minimum amount due - the payment = 100 - 80 = $20.

Since the tolerance method is set to 1, the platform uses the higher of the following values:

* **Overdue tolerance amount** : $70
* Calculated tolerance percentage: MAD x **Overdue tolerance percentage** = 100 x 10% = 100 x 0.1 = $10

Because $70 is greater than $10, the platform uses $70 as the actual tolerance value. The overdue amount is $20, which is less than $70, so the Pismo platform **does not** consider the account overdue.

## Example 2

Suppose you set the program parameters to the same values as in Example 1, except that **Overdue tolerance method** is set to 2.

| Parameter name                   | Value       |
| :------------------------------- | :---------- |
| **Overdue tolerance percentage** | 10%         |
| **Overdue tolerance amount**     | $70         |
| **Overdue tolerance method**     | 2 (Minimum) |

Suppose that:

* Minimum amount due (MAD) is $100.
* A payment is made of $80.
* Payment is received after the due date.

The overdue amount is:\
minimum amount due - the payment = 100 - 80 = $20.

Since **Overdue tolerance method** is set to 2, the Pismo platform uses the lower of the following values:

* **Overdue tolerance amount** : $70
* Calculated tolerance percentage: MAD x **Overdue tolerance percentage** = 100 x 10% = 100 x 0.1 = $10

Because $10 is lower than $70, the platform uses $10 as the actual tolerance value. The overdue amount is $20, which is greater than $10, so the Pismo platform **does** consider the account overdue.

## Example 3

Suppose `Overdue tolerance amount` is set to $70, and `Overdue tolerance percentage` is not set. In this case, `Overdue tolerance method` is not applicable and is ignored by the platform.

**Note:** Table entries marked **N/A** indicate **Not Applicable**.

| Parameter name                   | Value   |
| :------------------------------- | :------ |
| **Overdue tolerance percentage** | Not set |
| **Overdue tolerance amount**     | $70     |
| **Overdue tolerance method**     | N/A     |

Suppose that:

* Minimum amount due (MAD) is $100.
* A payment is made of $80.
* Payment is received after the due date.

The overdue amount is:\
minimum amount due - the payment = 100 - 80 = $20.

The overdue amount is $20, which is less than $70, so the Pismo platform **does not** consider the account overdue.

## Example 4

Suppose `Overdue tolerance percentage` is set to 10%, and `Overdue tolerance amount` is not set. In this case, `Overdue tolerance methods` is not applicable and is ignored by the platform.

**Note:** Table entries marked **N/A** indicate **Not Applicable**.

| Parameter name                   | Value   |
| :------------------------------- | :------ |
| **Overdue tolerance percentage** | 10%     |
| **Overdue tolerance amount**     | Not set |
| **Overdue tolerance method**     | N/A     |

Suppose that:

* Minimum amount due (MAD) is $100.
* A payment is made of $80.
* Payment is received after the due date.

The overdue amount is:\
minimum amount due - the payment = 100 - 80 = $20.

Calculated tolerance percentage: MAD x **Overdue tolerance percentage** = 100 x 10% = 100 x 0.1 = $10

The overdue amount is $20, which is greater than $10, so the Pismo platform **does** consider the account overdue.

## Example 5

Suppose you set the program parameters as follows.

| Parameter name                   | Value       |
| :------------------------------- | :---------- |
| **Overdue tolerance percentage** | 10%         |
| **Overdue tolerance amount**     | $70         |
| **Overdue tolerance method**     | 1 (Maximum) |

Suppose that:

* Minimum amount due (MAD) is $50.
* No payment is made.

The overdue amount is:\
minimum amount due - the payment = 50 - 0 = $50.

Since **Overdue tolerance method** is set to 2, the Pismo platform uses the greater of the following values:

* **Overdue tolerance amount** : $70
* Calculated tolerance percentage: MAD x **Overdue tolerance percentage** = 50 x 10% = 50 x 0.1 = $5

Because $70 is greater than $5, the platform uses $70 as the actual tolerance value. The overdue amount is $50, which is less than $70, so the Pismo platform **does not** consider the account overdue.

<br />
Parameter name	Definition
Overdue tolerance percentage	A percentage of the overdue amount that is used by the Overdue tolerance method to determine if the account should be considered overdue. Must be greater than 0 and less than or equal to 100.
Overdue tolerance amount	A fixed amount that is used by the Overdue tolerance method to determine if the account should be considered overdue. For example, $70.
Overdue tolerance method	The method to apply: * 0 — Do not use. * 1 — Maximum value. Between the Overdue tolerance amount and (MAD x Overdue tolerance percentage), use whichever value is greater. If the difference between the payment and the overdue amount is less than or equal to this value, the account is not considered overdue. * 2 — Minimum value. Between the Overdue tolerance amount and (MAD x Overdue tolerance percentage), use whichever value is lower. If the difference between the payment and the overdue amount is less than or equal to this value, the account is not considered overdue.