Configure Interest Service

Before assigning interest rates to credit products, you must configure the Interest Service to define the base rate structures. This setup enables support for both fixed and variable interest rate strategies aligned with your credit offerings.

Step 1: Define Variable Interest Rates

Variable interest definitions allow you to reference market-based indices like ESTR, EURIBOR, or LIBOR that are commonly used in floating-rate loan products.

Configuration Fields:

• Currency Select the currency (e.g., EUR, USD) the rate applies to.

• Name Internal identifier for the rate (e.g., ESTR, EURIBOR1W, USDLIBOR1M).

• Term Defines the rate’s frequency or maturity: Options include:

  • 1D (1 Day)

  • 1W (1 Week)

  • 2W, 1M, 3M, etc.

• Value Date Modifier An integer value that shifts the effective date of the interest rate:

  • 0 = same day

  • -1 = previous day

  • +1 = next day Useful for aligning with central bank or benchmark publication timelines.

• Is Enabled Toggle to activate the rate in live products.

Example Setup:

Currency	Name	Term	Value Modifier
EUR	ESTR	1D	-1
EUR	EURIBOR1W	1W	-1
USD	USDLIBOR1M	1M	-2

You can configure multiple rates for a single currency to support different product needs (e.g., EURIBOR1W for short-term loans, EURIBOR3M for longer terms).

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Step 2: Reference Interest Rates in Credit Products

Once configured, these variable rates can be:

• Attached to loan products using the Product Configuration Service

• Combined with a margin (spread) to define the final interest rate

• Updated via API integrations with market data providers

• Linked with interest trackers that now support automatic termination handling for more accurate lifecycle management.

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Best Practices

• Limit duplicate names: Use consistent and descriptive naming for clarity (e.g., EURIBOR3M instead of just 3M).

• Align rate terms with repayment frequency (e.g., use a 1M rate for monthly repayments).

• Verify value date logic: Ensure correct modifier values to avoid misalignment in interest calculations.

• Enable only required rates: To keep the configuration clean and manageable.

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Once configured, variable interest definitions are used in product setup to define rate models (e.g., EURIBOR3M + margin). These are later linked in credit contracts to ensure accurate, dynamic interest calculation based on the selected rate, currency, and term.