# What are the interest calculation option available on ADDA?

In ADDA, we have multiple ways to calculate interest on unpaid dues. The best-suggested method is using Simple Interest. However, we do have other options as well which are well explained below:

1. Simple Interest p.a (Considered Billing is Monthly / Quarterly/ Semi-Annually / Annually):

A. Considering the Grace Period: Interest Rate is 21% p.a  and Grace Days: 10 days

If the April Bill Amount as of 1st April is Rs 1000 and the Outstanding is Rs 500, so the Interest will be charged after the grace period that is after the 10th of April, if any members make the payment within the grace period Interest won't be charged on Rs 1000 but the Interest will be charged on the Outstanding irrespective of the Grace period.

Case 1: If the Members Make the Payment on 5th of the April Interest Charge on the April Amount will be Nil but the Interest charge on the Outstanding amount Rs 500 will be from 1st April to 5th April.
Calculation: (21%*500*5) / 365 = Rs 1.43

Case 2: If the Members Make the Payment on 16th of the April Interest Charge on the April Amount Rs 1000 will be for 6 days after 10th of April but the Interest charge on the Outstanding amount Rs 500 will be from 1st April to 15th April.
Calculation: (21%*1000*6) / 365 = Rs 3.45
(21%*500*16) / 365 = Rs 4.60
Total Interest Applicable: Rs 8.05

B. Considering without Grace Period: Interest will be calculated from the date of the Invoice till the amount is been made in that month.

2. Flat Rate (Considered Billing is Monthly / Quarterly/ Semi-Annually / Annually):

A. Considering the Grace Period: Flat Rate is Rs 100 and Grace Days: 10 days,

If the April Bill Amount as of 1st April is Rs 1000 and the Outstanding is Rs 500, so the Interest will be charged after the grace period that is after the 10th of April, if any members make the payment within the grace period Interest won't be charged on Rs 1000 but the Interest will be charged on the Outstanding irrespective of the Grace period.

Case 1: If the Members Make the Payment on 5th of the April Interest Charge on the April Amount will be Nill.
Calculation:  Rs 0

Case 2: If the Members Make the Payment on 16th of the April Interest Charge on the April Amount Rs 1500 will be Rs 100 in the May bills if the Members fails to pay the Bill in the May also then Flat rate will be charged in the June bill Rs 200 and so on.

B. Considering without Grace Period: Interest will be calculated from the date of the Invoice till the amount is been made in that month.

3. Flat Rate (Considered Billing is Monthly / Quarterly/ Semi-Annually / Annually)

A. Considering the Grace Period: Flat Rate is Rs 100 and Grace Days: 10 days,

If the April Bill Amount as of 1st April is Rs 1000 and the Outstanding is Rs 500, so the Interest will be charged after the grace period that is after the 10th of April, if any members make the payment within the grace period Interest won't be charged on Rs 1000 but the Interest will be charged on the Outstanding irrespective of the Grace period.

Case1: If the Members Make the Payment on 5th of the April Interest Charge on the April Amount will be Nill.
Calculation:  Rs 0

Case2: If the Members Make the Payment on 16th of the April Interest Charge on the April Amount Rs 1500 will be Rs 100 in the May bills if the Members fails to pay the Bill in the May also then Flat rate will be charged in the June bill Rs 200 and so on.

B. Considering without Grace Period: Interest will be calculated from the date of the Invoice till the amount is been made in that month.

4Simple Interest, Arrears will use Grace period (Considered Billing is Monthly / Quarterly/ Semi-Annually / Annually) :

Considering the Grace days: Interest Rate is 21% p.a  and Grace Days: 10 days,

If the April Bill Amount as of 1st April is Rs 1000 and the Outstanding is Rs 500, so the Interest will be charged after the grace period that is after the 10th of April, if any members make the payment within the grace period Interest won't be charged on Rs 1000  as well on the Outstanding amount.

Case1: If the Members Make the Payment on 5th of the April Interest Charge on the April Amount will be Nil both on April Invoice amount and Outstanding amount.
Calculation: LPI: RS 0

Case2: If the Members Make the Payment on 16th of the April Interest Charge on the April Amount Rs 1500 will be for 6 days after 10th of April considering the Outstanding amount.
Calculation: (21%*1500*6) / 365 = Rs 5.17

P.S. Considering Without grace Period Interest will be calculated from the date of the Invoice till the amount is been made in that month.

5. Monthly Interest, Arrears will use the Grace period:

Considering the Grace days: Interest Rate is 21% p.a  and Grace Days: 10 days,

If the April Bill Amount as of 1st April is Rs 1000 and the Outstanding is Rs 500, so the Interest will be charged after the grace period that is after the 10th of April, if any members make the payment within the grace period Interest won't be charged on Rs 1000  as well on the Outstanding amount.

Case 1: If the Members Make the Payment on 5th of the April Interest Charge on the April Amount will be Nil both on April Invoice amount and Outstanding amount.
Calculation: LPI: RS 0

Case 2: If the Members Make the Payment on 16th of the April Interest Charge on the April Amount Rs 1500 will be for 30 days after 10th of April considering the Outstanding amount.
Calculation: (21%*1500* 30) / 365 = Rs 25.89