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Fixed Loan Term

SmartCredit.io loans have fixed terms from 11 to 180 days. Knowing the exact maturity date lets borrowers plan repayment and lenders eliminate bank-run risk.

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Key Takeaways

  • SmartCredit.io loan terms range from 11 to 180 days, chosen by the borrower at loan creation.
  • The interest rate and total cost are fixed and known before the loan starts.
  • At maturity, the borrower must repay the principal plus interest plus fees; failure triggers liquidation of the posted collateral.
  • Fixed terms enable precise collateral calculations and allow lenders to match their own investment horizon.
  • Shorter terms (11-30 days) suit short-term liquidity needs; longer terms (91-180 days) suit higher-yield income strategies for lenders.

The loan term is from 11 days to 180 days. The borrower selects the term when creating a loan request; the term is fixed and cannot be changed after the loan is funded.

Why Fixed Terms Matter

For borrowers: Knowing the exact repayment date eliminates the uncertainty of variable-term protocols where lenders can call back funds at any time. Borrowers can plan cash flow and capital deployment in advance.

For lenders: Fixed terms mean lenders know exactly when their funds will be returned. This maturity matching between borrower and lender eliminates the bank-run risk that affects open-ended money-market funds like Aave or Compound.

What Happens at Maturity

At the end of the loan term, the borrower must repay the full principal, interest, and platform fee (0.5%). If repayment is not made on time, the loan is liquidated:

  1. The collateral assets held in the credit line are sold to cover the outstanding balance.
  2. The lender receives the loan principal plus interest.
  3. The SmartCredit.io platform receives the 0.5% platform fee.
  4. Any remaining collateral value after covering the obligations is returned to the borrower’s credit line, where it can be reused for future loans.

Choosing the Right Term

Term Range Use Case Collateral Requirement
11-30 days Short-term liquidity, lower collateral Lower
31-90 days Medium-term strategies Medium
91-180 days Longer-term yield optimization Higher

Longer terms have higher collateral requirements because asset price volatility compounds over time.

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