> For the complete documentation index, see [llms.txt](https://docs.xyb.co/llms.txt). Markdown versions of documentation pages are available by appending `.md` to page URLs; this page is available as [Markdown](https://docs.xyb.co/credit/use-case-tutorials/nordic-revolving-credit-line-overview/how-to-disburse-loans-using-the-nordic-revolving-credit-line.md).
# How to Disburse Loans Using the Nordic Revolving Credit Line
Once the **Nordic Revolving Credit** product has been configured by your product team, operations teams can start using it to issue credit facilities to individual customers, and later initiate disbursements (sub-contracts) under that facility.
This guide explains how to:
* Select the right product group and product
* Create a credit facility (main contract)
* Disburse individual drawdowns (sub-contracts)
* Track contract and repayment status
***
#### How It Works
The Nordic Credit Line is a **parent-child contract model**:
* **Main contract** = the credit facility (limit, terms, schedule, etc.)
* **Sub-contracts** = individual drawdowns, repaid over time like loans
* All repayments and invoices are **consolidated under the parent**
***
**Create the Main Credit Contract**
1. Go to **Contracts > Lending > Create**
2. Under **Customer**, select the customer (e.g., Eva Jensen)
3. In **Product Group**, select: `Credit Line`
4. In **Product Name**, select: `Nordic Revolving Credit`\
\
5. Set the **Start Date** and **End Date**\
Note that based on the product settings, some fields will be autopopulated.
6. Choose:
* **Schedule Type**: Typically `Annuity`
* **Day of the Month**: When payments are due
* **Contract Period Count Type**: `Month`
* **Contract Purpose**: E.g., Margin Lending
7. Set **Amount** and **Limit** (they may match if unused)
**Note**: You can also assign fees and terms, but most are pre-configured from the product.
***
7. Configure Interest Details
In this section, define how interest should be calculated and applied for this customer contract. These values are based on your global interest service setup and the rules associated with the selected product.
| Field | Description |
| -------------------------------------------- | ------------------------------------------------------------------------------------------------------------------- |
| **Principal interest margin (%)** | Add the fixed margin over the base rate (e.g., `15.6`). Use comma `,` as a decimal separator if required by locale. |
| **Interest base rate method** | Automatically populated from product setup. This field is non-editable at contract level. |
| **Interest base rate (%)** | If applicable, input the current reference rate |
| **Principal interest day count convention** | Select how days are counted for accruals (e.g., `ACT/360`). |
| **Commitment interest margin (%)** | Additional charge for unused amounts |
| **Commitment interest day count convention** | Same logic as principal interest. |
| **Penalty rate (%)** | Rate applied to overdue principal or interest |
| **Penalty day count convention** | Used for penalty interest accrual |
| **Principal frequency** | How often principal payments are expected |
| **Interest frequency** | How often interest is due (e.g., `Monthly`). |
| **First principal payback period** | Grace period before first principal repayment (e.g., `1` = first payment after 1 cycle). |
| **First interest payback period** | Grace period before first interest payment |
**Note**: All these values must comply with the product definition and your internal lending rules. Any unsupported configuration will block contract creation or repayment calculations.
8. Add Contract Fees
This step lets you **attach a fee** to the credit contract, for example, a **disbursement fee** deducted at payout.
You simply:
* Select the **fee type** (e.g., *Disbursement fee*)
* Name it (e.g., *Payout fee*)
* Set the **calculation method** (e.g., *Fixed amount*)
* Enter the **fee amount** and **start date**
Once saved, the fee is applied automatically during contract execution and tracked in the contract's financials.
***
***
---
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