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Rate arrangement

Who sets the interest,
and how it is worked out

There are two kinds of loan on this platform, and they are not priced the same way. This page explains both, so you always know whose rate you are agreeing to.

Arrangement 1
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INSTABUXX funds the loan

We lend our own money at two published INSTABUXX rates. Employees of companies registered with INSTABUXX get our lowest rate, because the employer’s payroll repays the loan on payday. Everyone else pays our higher rate and repays us directly. And if you are short on your due date, you do not have to pay in full: you can pay just the interest and pay the loan back when you are able.

Where we lendNational Capital District (NCD)
Loan amountK100 to K1,000
Longest loan14 days
Interest typeFixed
TermFortnightly (14 days)
Rate, employer registered10% fixed, charged once
Base interestNo base interest
If not repaid by the due dateAnother 10% is charged on the original amount for a further fortnight, for every fortnight it stays unpaid
Can’t repay in full?Pay the interest (10%) on the due date, then due on your next pay day
RepaymentOne payment on payday, via your employer’s payroll
Largest loan, employer not registeredK500
Rate, employer not registered20% fixed, charged once
Interest only, employer not registered20% of the amount
Repayment, employer not registeredOne payment on payday, directly to INSTABUXX
Calculate at this rate
Arrangement 2
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A private lender funds it

A lender on our platform is using their own money, so they set their own terms. The rate can be higher or lower than ours.

  • check_circleInterest type — fixed or variable
  • check_circleTerm — daily, weekly, fortnightly or monthly
  • check_circleRate — a percentage per term
  • check_circleBase interest — a percentage or a flat kina charge, and whether it repeats
  • check_circleTerm expiry rule — what happens if you do not pay on time
  • check_circleDefault rate and what it is charged on

You will always see the lender's exact terms in the agreement email before you sign, and on the loan in your dashboard. Nothing is applied that you have not seen.

I want to lend
The seven settings

What a lender can choose

Every lender configures these before their loans go out. Understanding them means you can compare one lender against another.

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1. Interest type

Fixed — the rate is charged once for the term, however long the loan runs inside it.

Variable — the rate is charged for every term that passes, so the cost grows over time.

INSTABUXX uses fixed interest.

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2. Term

The period the rate is charged over: daily (1 day), weekly (7), fortnightly (14) or monthly (30). A 10% weekly rate is very different from 10% monthly — always check the term, not just the number.

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3. Rate

The percentage charged for each term. Read it together with the term above — the number on its own tells you very little. INSTABUXX charges 10%, or 20% if the employer is not registered, fixed for a loan of up to 14 days.

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4. Base interest

A charge applied when the loan is funded, separate from the per-term rate. It can be a rate (a percentage of what you borrow) or a fixed amount (a flat kina fee).

The lender also chooses whether it is charged only once or re-applied each time a term expires unpaid — and if re-applied as a rate, whether that is on the total payable or the original amount. INSTABUXX loans have no base interest.

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5. Term expiry rule

What happens if the due date passes unpaid:
Rollover — your whole balance becomes a new loan on the same terms.
Add interest — one more term's interest is charged on the original amount.
Default rate — the rate switches to the lender's default rate.

INSTABUXX uses add interest: another 10% (20% if the employer is not registered) of the original amount for every fortnight the loan stays unpaid.

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6. Default rate & basis

The rate charged once a loan has defaulted, and whether it applies to the total payable (interest on interest — more expensive) or the original amount only. INSTABUXX loans do not switch to a default rate — see the expiry rule.

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7. Interest-only settlement

Whether a borrower who cannot repay in full on the due date may pay interest only and have the loan start again for another term on the same amount — and the multiplier: at 2×, a borrower whose term interest is K100 pays K200. INSTABUXX allows it: you pay the interest and the loan is then due on your next pay day.

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Your rate is locked in

The terms are recorded on your loan the moment you apply. If the lender later changes their rate card, your existing loan is not affected — only new loans use the new terms.

Side by side

The same K1,000, priced four ways

All borrowed for 14 days. This is why the term and the type matter as much as the headline percentage.

Lender's terms Type Term Rate Base interest Interest You repay
INSTABUXX FixedFortnightly 10% None K100.00 K1,100.00
INSTABUXX, employer not registered (K500 maximum; K1,000 shown only to compare) FixedFortnightly 20% None K200.00 K1,200.00
Example lender A VariableWeekly 8% None K160.00 K1,160.00
Example lender B FixedFortnightly 15% K50 flat, once K200.00 K1,200.00
Example lender C FixedMonthly 20% None K200.00 K1,200.00

Illustrative figures for lenders A, B and C. Real lender rates vary — the terms on your loan are always shown to you before you sign.

Whatever the rate, your limit still applies. Your total repayable must stay within 60% of your take-home pay, so a more expensive lender simply means you can borrow less from them. Check with the calculator.

Questions

About rates

Not sure which arrangement your loan falls under? Ask us.

How do I know whose rate I am getting?

If you apply without a Lender ID, INSTABUXX funds the loan at the published INSTABUXX rate — 10% if your company is registered with INSTABUXX, 20% if it is not. If you enter a lender's LUID, that lender's own terms apply — and they are set out in full in the agreement email you have to sign before the loan is reviewed.

Can a lender change my rate after I have borrowed?

No. Your terms are recorded against your loan when you apply. A lender can change their rate card at any time, but it only affects loans taken out after the change.

Is a lower percentage always cheaper?

Not necessarily — the term matters. 10% per week is far more expensive than 10% per month. Compare the total repayable, which the calculator and your agreement both show you.

What does "default charged on the total payable" mean?

It means default interest is calculated on your whole outstanding balance, including interest already accrued, rather than just on the amount you originally borrowed. It compounds faster, so it is the more expensive of the two options.

What is "base interest" and can it be charged twice?

Base interest is a charge applied when your loan is funded, on top of the per-term rate. It is either a percentage of what you borrow or a flat kina fee. Whether it can be charged again depends on the lender: some charge it only once, others re-apply it every time a term expires unpaid. New INSTABUXX loans have no base interest — only the 10% fixed interest. Your agreement always states which applies.

What is interest-only settlement?

If you cannot repay the whole balance on your due date, and your lender allows it, you pay only the interest — times the lender's multiplier — and the loan starts again, from the day you pay, for another term on the same amount. With INSTABUXX: borrow K1,000 at 10% and you owe K1,100 on the due date. Pay K100 (10% of the amount) instead, and K1,100 is due on your next pay day. You can do it again if you need to. If your employer is not registered: borrow K500 at 20%, you owe K600, and interest only costs K100. Unlike a rollover, your loan does not grow: the amount you borrowed stays the same.

What is a rollover?

If a lender's expiry rule is rollover and you do not pay by the due date, your entire balance becomes the principal of a brand-new loan on the same terms. Interest then starts accruing on that larger figure, so a rollover is expensive — pay on time.

I lend money. Where do I set my own terms?

Register as a lender, then open My Interest Terms on your dashboard. You will see a worked example update as you change each setting. More about lending.

Know the rate before you borrow

Run your numbers, then apply with confidence.

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