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Fixed Interest Rate

SmartCredit.io offers fixed interest rates locked at loan creation. Rates follow upward-sloping yield curves - longer terms earn higher APY. Borrowers know their exact cost of capital before taking a loan.

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Key Takeaways

  • Interest rates on SmartCredit.io are fixed at loan creation and cannot change during the loan term.
  • Rates follow standard upward-sloping yield curves: longer terms mean higher APY for lenders.
  • The concrete rate depends on the loan term, the underlying asset, and the borrower's trust score.
  • Borrowers pay the lender's interest rate plus a 0.5% platform fee and a small loss-provision contribution.
  • A borrower locking in a rate for a 90-day loan knows exactly what they will owe at maturity - unlike variable-rate DeFi protocols.

SmartCredit.io fixes the interest rate at loan creation. These are standard, upward-sloping yield curves, meaning the longer the loan term, the higher the APY.

The concrete interest rate for a loan depends on:

  • The loan term-the longer the loan term, the higher the interest rate.
  • Trust score-every borrower is automatically trust scored. Every borrower can try to increase their trust score by submitting additional information. The better the trust score, the better the interest rate.
  • The underlying asset-different assets have different predefined yield curves.

The lender receives the interest rate, as defined via the SmartCredit.io yield curves (standard upward-sloping yield curves).

The borrower pays:

  • The interest rate for the lender
  • The platform fee is 0.5% of the loan principal (see the Revenue Model)
  • The loss-provision fee is accumulated into the Loss-Provision Fund and used in adverse situations

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