Late Payment Interest Calculator
Calculate interest and admin fees on overdue invoices using annual, monthly, or fixed rate methods. Supports compound interest and batch processing.
Daily rate: 0.0329%
Interest compounds monthly on previously accrued interest
Fixed fee per late invoice for administrative costs
Important Notice
This calculator provides an estimate for late payment interest and admin fees based on your chosen parameters. Always ensure your late payment terms comply with local regulations and are clearly communicated to customers before extending credit.
How Late Payment Interest Works
Annual Rate Method
Calculates daily interest by dividing the annual rate by 365, then multiplying by days overdue. Most common for B2B invoices.
Monthly Rate Method
Applies a monthly percentage rate proportionally based on days overdue. Common for consumer credit and retail.
Fixed Percentage
Charges a one-time percentage fee regardless of how long the payment is overdue. Simple and easy to communicate.
Best Practices for Late Payment Policies
Clear Communication
State late payment terms clearly on all invoices, contracts, and payment reminders.
Reasonable Rates
Use industry-standard rates (1-2% monthly) that are enforceable in your jurisdiction.
Grace Periods
Consider offering a brief grace period before applying interest to maintain customer relationships.
Consistent Enforcement
Apply late fees consistently to all customers to avoid discrimination claims.
Legal Compliance
Verify maximum allowable rates and disclosure requirements in your jurisdiction.
Automated Tracking
Use invoicing software to automatically calculate and apply late fees.
Frequently Asked Questions
Automate Late Payment Tracking
PineBill automatically tracks overdue invoices, calculates late fees, and sends payment reminders so you get paid faster.