Payment Methods

This section explains how the different payment methods available in lending product work. Each of these methods has specific characteristics on how interest is calculated, how partial or additional payments are applied, and how they affect the number or amount of the installments.

Current Debt Amount Reduction

This method charges interest until the payment is made. Interest is not projected for the future. Partial payments are allowed, and if a payment exceeds the installment amount, the capital balance will be reduced, thereby lowering the amount of subsequent installments.
Characteristics:
• Interest charged until the payment date.
• No projected interest.
• Partial payments allowed.
• Additional payments reduce capital, decreasing subsequent installments.

Current Debt Quantity Reduction

Like the previous method, interest is charged until the payment is made, with no interest projections for the future. In this case, if an additional payment is made, the number of remaining installments will be reduced, while the amount of the initial installments remains unchanged.
Characteristics:
• Interest charged until the payment date.
• No projected interest.
• Partial payments allowed.
• Additional payments reduce the number of installments, keeping the value of the initial installments.

Amount Reduction

This method projects the interest of the current installment until the payment date. If an additional amount is paid, the capital balance will be reduced, decreasing the installment amount. Partial payments are allowed.
Characteristics:
• Interest projected until the payment date.
• Additional payments reduce the capital, lowering the installment amount.
• Partial payments allowed.

Quantity Reduction

Similar to the "Amount Reduction" method, but in this case, if an additional payment is made, the capital is reduced and the number of installments is decreased, while keeping the value of the original installments. Interest is projected until the payment date.
Characteristics:
• Interest projected until the payment date.
• Additional payments reduce capital and the number of installments, maintaining the original installment amounts.
• Partial payments allowed.

Total

This method involves paying only the total amount owed, including interest calculated up to the payment date. Interest is not projected. If the payment does not exactly match the owed amount, the payment will be rejected.
Characteristics:
• Only the total owed amount (capital + interest calculated up to the payment date) is paid.
• No projected interest.
• The payment must be exact; any discrepancy will result in the rejection of the payment.

Installment

This method allows payments to be made according to the installment amount defined in the payment plan. Interest is projected until the relevant installment. No payment can be made that is greater or lesser than the agreed installment amount.
Characteristics:
• Payments are made according to the projected interest amount until the relevant installment.
• No additional or lesser payment than the agreed installment amount is allowed.

Installment Advance

This method projects interest according to the payment plan. Partial payments are allowed, and if an additional payment is made, interest for the next installment is projected, and the payment will be applied as outlined in the payment plan.
Characteristics:
• Interest is projected according to the payment plan.
• Partial payments allowed.
• Additional payments project the interest of the next installment, and the payment will be applied according to the payment plan.