Prodigy Finance charges simple interest, meaning that the interest does not compound throughout the life of the loan*. The interest rate is variable, and is made up of two components:
- a fixed margin, determined by Prodigy Finance
- a variable benchmark rate
Prodigy Finance doesn’t benefit from rising interest rates - we charge a processing fee of up to $100 to reserve your funds and a fixed admin fee of up to 5% of the loan amount to finalise your loan, and receive an annual fixed loan servicing fee from our funders. These fees are the only sources of income for Prodigy and pay for our running costs.
How are the fees charged?
We charge a processing fee of up to USD 100, payable when the funds are matched to the loan application to reserve your funds with us, and before we finalise your loan.
We also charge an admin fee for each loan we issue. The admin fee is up to 5% of the total loan amount. This fee is added to your loan amount when the loan is issued and spread across your monthly payments- you're never required to pay this fee upfront.
*The simple interest accruing and charged during the grace period will be capitalised on the first repayment date and added to the outstanding balance, whereafter simple interest is charged on the new balance.