TABLE OF CONTENTS

• Interest on your Fair for you Loan
• Why Does My Balance Change?
• Understanding the Basics
• How Can I Reduce the Amount of Interest I Pay?
• What Is APR?
• Why Is APR Important?
• Will I Know How Much I'll Repay?

Interest on your Fair for you Loan

When you borrow money, interest is the cost of borrowing that money.

At Fair for You, interest is added to most of our loans and helps cover the costs of providing responsible lending and ongoing support to our customers.

Our standard rates are:

• 51% per annum
• 64.8% APR Representative
• The Food Club Card is interest-free. 

Before you accept a loan, we'll always show you:

• How much you're borrowing
• How much interest will be charged
• The total amount you'll repay
• Your repayment schedule

This means you'll know exactly what your loan will cost before you agree to it.

Why Does My Balance Change?

For loans that charge interest, interest is calculated and added to your account on a daily basis based on your outstanding balance.

This means that:

• Your balance may increase slightly each day if there is still money left to repay.
• If you make payments early or pay more than your scheduled amount, you'll reduce your outstanding balance sooner and pay less interest overall.
• Full details of how interest is charged can be found in your loan agreement.

If you haven't made a payment since your last balance update, you may notice that your balance has increased. This is because interest is added daily to your account while there is still an outstanding balance.

Don't worry - this doesn't mean you'll pay more than the total amount shown in your loan agreement, provided you continue to make your agreed repayments.

Calculating interest daily means that customers who repay their loans early benefit from paying less interest overall, as interest is only charged on the balance that remains outstanding.

Understanding the Basics

Principal

The principal is the amount you borrow.

For example, if you borrow £300, your principal is £300.

Interest

Interest is the additional amount charged for borrowing the money.

This is added to your loan and repaid as part of your regular repayments.

Interest Rate

The interest rate is the percentage used to calculate how much interest is charged on your loan.

How Can I Reduce the Amount of Interest I Pay?

The amount of interest you pay depends on how long you borrow for.

In general:

• Shorter loan terms mean less interest paid overall
• Longer loan terms mean more interest paid overall

Because of this, if you can afford to repay your loan more quickly, you'll usually pay less in total.

Paying Early

You can make extra payments or repay your loan early at any time.

There are no penalty fees for paying your loan off early.

The sooner you repay your loan, the less interest you'll pay overall.

What Is APR?

APR stands for Annual Percentage Rate.

APR is designed to help you compare the cost of borrowing between different lenders.

It represents the total yearly cost of borrowing, expressed as a percentage.

APR can include:

• Interest charges
• Certain fees and charges (where applicable)

Because APR takes more than just the interest rate into account, it can give a better indication of the overall cost of a loan.

Why Is APR Important?

APR helps you compare different borrowing options more easily.

For example, one lender may advertise a lower interest rate, but if they charge additional fees, the loan could actually cost more overall.

Looking at the APR can help you understand the total cost of borrowing and make an informed decision.

Will I Know How Much I'll Repay?

Yes. Before you accept your loan agreement, we'll clearly show:

• The amount you're borrowing
• The interest that will be charged
• Your repayment amounts
• The total amount you'll repay over the life of the loan

This allows you to decide whether the loan is affordable and right for your circumstances before you commit.