Although the Nexo loan may seem similar to a term loan since it’s collateralized by an asset (cryptocurrency in our case), they are not the same. Usually, a term loan has fixed monthly or quarterly instalment payments. With the Nexo loan, you can manage your repayments the way you like, including repaying early without penalty fees or not repaying until the collateral crypto-asset meets your target price.
The Nexo loan has a fixed Annual Percentage Rate (APR), which starts at 6.9% when at least 10% of the value of your portfolio balance (crypto, stablecoins and FiatX) is in NEXO Tokens. In other words, you are in the Platinium tier of our Loyalty Program.
The Annual Percentage Rate when not utilizing NEXO Tokens is 13.9%.
Important: Please note that loans repaid in less than 30 days are charged interest for the remainder of the 30-day period at the standard APR of 13.9% regardless of your loyalty tier. This is in order to prevent improper use of the Nexo Platform and to safeguard Nexo as a company, but more importantly, our clients and investors.
This information is also available on the Credit Line Repayment screen as seen in the sample screenshot below:
Example:
If you are repaying a loan 20 days after you took it, you will be charged the additional interest for the remaining 10 days out of the 30-day period (30 – 20 = 10) at 13.9%.
Please keep in mind that the interest applied to your loans is compound interest i.e. it is calculated based on both the initial principal and the accumulated interest.