Costs and interest — glossary

The sum of the total loan amount and the total cost, determined according to the terms of the contract. It shows the total load with repayment in line with the assumptions made.

In practice: For example, PLN 3,000 of funds made available and PLN 360 of costs means PLN 3,360 to be paid. With a variable interest rate, your future sum may depend on changes in the rate. The costs of late repayment should be analyzed separately.

In consumer credit, it means funds made available to the consumer in accordance with the statutory definition, without credited credit costs. It is a different quantity than the total amount to be paid.

In practice: Do not equate it without checking with the sum of all items financed by the bank. If the commission is credited, it is worth seeing the amount paid, the cost and the method of calculating interest indicated in the documents separately.

The total cost to a consumer of a loan, including interest and applicable fees and charges.

It is not just the amount of capital received. The total amount to be paid includes both the returned capital and the total cost of the loan.

In practice: Compare the payout amount, total cost and repayment amount separately.

Source: UOKiK - consumer credit costs.

Euro money market benchmark administered by the European Money Markets Institute. It may be a component of the interest rate on certain loans and other financial agreements.

In practice: In the contract you will find a specific type of index and rules for updating the interest rate. EURIBOR is not the total cost of the loan: it includes, among others: margin and possible fees. Its changes may affect the amount of installments.

A fee between card system participants related to the settlement of card payments. It is one of the components of the transaction processing cost, and not the entire fee charged to the seller.

In practice: It should not be equated with the commission for cash withdrawal or the card interest rate. The height depends on, among others: on the type of transaction and regulation. The seller's costs may include fees from the acquirer and the card organization.

The amount of financing provided that a borrower is expected to repay, distinguished from interest and other costs. The installment schedule may have a separate capital part.

In practice: Paying interest or fees alone does not necessarily reduce your principal. Check the order in which your payments are credited and the balance remaining to be refunded. For credited costs, distinguish the amount actually received from all amounts financed by the contract.

Charges incurred in connection with financing, beyond the return of the capital itself. They may include interest, commission and other required fees, depending on the type of contract.

In practice: Compare the cost expressed in PLN and APR, as well as the total amount to be paid. The costs of delay are not the same as the normal cost of a loan being repaid on time. Also check out paid additional services.

Fees and expenses related to enforcement, settled in accordance with applicable regulations. Their amount and the obligation to pay depend on the type of action, the course of the case and the basis for the decision.

In practice: Enforcement costs are separate from the debt principal itself and the costs of private collection. Ask for settlement and keep your resolutions. Voluntary payment at a certain stage may make a difference in settlement, but does not always remove all costs incurred.

Costs related to conducting the case before the court, including appropriate fees, expenses and other components due according to the rules of procedure. Who is responsible for them is determined by regulations and court decisions.

In practice: Do not associate them with any fee included in the collection notice. Check the basis for the request and the ruling. The possibility of exemption from costs or obtaining legal aid depends on the conditions and the appropriate application, and not on the fact of the debt itself.

Costs of activities related to the recovery of overdue receivables. Their transfer to the debtor requires an appropriate basis and compliance with legal restrictions and the terms of the contract.

In practice: The Company cannot arbitrarily charge every fee described in a message. Distinguish the settlement of private activities from court and enforcement costs. Ask for the basis and detailed calculation if the amount requested is questionable.

A historical benchmark used in financial contracts in various currencies, including: in former Swiss franc loans. Publication of all its variations has been completed; last discontinued in September 2024.

In practice: The name may still appear in an older contract. The method of replacing the indicator results from the relevant regulations and contractual documents. LIBOR should not be described as the current rate available for new loans.

A contractual component of the financing price. With many variable-rate loans, the rate consists of a benchmark and the lender's margin.

In practice: Margin is not the same as commission or APR. Check whether it is constant throughout the entire period and what the discounts depend on. Dropping a required add-on product may change the margin if the contract provides for it.

An amount accrued at a specific rate, basis and time. Capital interest is the price of using money, and late payment interest is related to late payment.

In practice: The APR does not automatically mean the cost per month. The amount also depends on the balance and the method of calculation. Loans may also include commissions, so interest alone does not show the total cost.

Interest related to untimely payment of monetary receivables. Their basis and amount result from the contract or regulations, taking into account the statutory limitation of the maximum rate.

In practice: Billing applies to the correct outstanding amount and period, not any lump sum. It is worth distinguishing them from ordinary capital interest. When you receive your settlement, check your deposit dates and the rate applied.

The time during which a specific use of the limit may not generate interest once the product conditions are met. Most often, it applies to selected credit card transactions and timely full repayment of the statement.

In practice: It doesn't have to include cash withdrawals or every online transaction. The lack of interest does not exclude other fees. Check your statement date, full repayment date and the consequences of paying only the minimum amount.

A fee described as the cost of preparing, servicing or conducting a contract. Its actual nature depends on the financing conditions, regardless of the marketing name adopted.

In practice: Check whether it is one-off or recurring, when it becomes due and whether it is included in the total cost. The name itself does not exempt the fee from statutory restrictions or from assessing the legality of its provisions.

A fee related to the preparation or granting of financing, if provided for in the terms of a given offer.

It is a cost other than interest. When comparing loans, it should be taken into account along with other mandatory fees, and not based on the interest rate alone.

In practice: Determine whether the fee is deducted from your paycheck, added to your repayment or credited.

Source: UOKiK - consumer credit costs.

The cost of a service consisting in e.g. delivery of funds or collection of installments by a company representative. The scope and payment should result from the documents of a given product.

In practice: Ask if the service is mandatory, if you can choose to transfer it, and how this will change the overall cost. Also check the rules for canceling visits and confirming payments. It is worth documenting every cash payment.

A rate that determines how interest on capital is calculated. It may be permanent, periodically fixed or variable, depending on the product and the provisions of the contract.

In practice: The nominal interest rate does not automatically cover all commissions and fees. Therefore, also compare the APR and the amount to be paid. With a variable rate, check the rate, margin and frequency of installment updates.

The interest rate is set for the entire contract period or for a specified period of time. Its basic feature is the lack of change in the rate itself during this agreed period.

In practice: Mortgage loans offer periodically fixed interest rates. After this period ends, the terms may be re-established. Check whether the rate is fixed or installment only, and what fees apply apart from interest.

An interest rate that may vary according to a mechanism specified in the contract. It is often based on a reference index plus a margin.

In practice: Read when and on what basis the update takes place. A decrease in rates may lower the installment and an increase may increase it. When planning your budget, also consider the option of a higher payment, instead of analyzing only the initial amount.

A promotion for a specific group of new customers, in which financing repaid on time may not generate interest or other costs. The scope depends on the terms and conditions of the offer.

In practice: Check the amount limit, period, additional conditions and total amount to be paid. A 0% interest rate alone is not sufficient to consider the loan free. Another contract or delay may be settled differently.

Costs other than interest that are covered by the applicable statutory definition. May include commissions, fees and certain required additional services related to financing.

In practice: Not every fee name creates a separate category outside the limits of the law. All product documents, including related services, are required for evaluation. Cost limits depend on the type of contract and the applicable regulations.

Remuneration charged for a specific activity, such as providing financing or servicing a product. It may be in the form of a fixed amount or a percentage of the indicated basis.

In practice: Check whether the commission is paid from your own funds, deducted during payment or financed with a loan. In the latter case, interest on the financed amount may be claimed. The commission affects the total cost and comparison of offers.

Changing the currency of the obligation or converting a specific payment to another currency. Settlement takes place according to the exchange rate and rules specified in the contract or regulations.

In practice: The result is influenced by the exchange rate, spread and possible commission. In the case of a loan, changing the currency may also change the interest rate and risk. Before making a decision, compare the balance and future installments in both variants.

Example of financing parameters used to present costs and APR with the indicated assumptions. It usually includes the amount, period, interest rate, cost and amount to be paid.

In practice: It is not an individual offer for each client and each amount. Pay attention to the date and type of product. Converting the cost proportionally without knowing the tariff should be described as an indicative calculation.

The actual annual interest rate shows the total cost of the loan in percentage terms per year, taking into account, among others, payment and repayment dates and costs included in the calculation.

In practice: This is a broader indicator than the nominal interest rate. It is best to compare it with offers of a similar amount and repayment time. In short loans, the annual conversion may give a high value, so also check the cost in PLN.

Possibility of change in the value of the liability due to exchange rate fluctuations. This applies especially to situations where the client's income is in a different currency than the debt settlement.

In practice: A weakening of the income currency may increase the burden of installments and the balance after conversion. Conversion rules and spreads also have an impact. When analyzing such financing, take into account the unfavorable exchange rate scenario and long-term income stability.

The difference between the buying and selling rates of a currency used by an institution. It may affect the costs of exchanging money and settling foreign currency loans.

In practice: For comparison, you need not only the spread itself, but the rate actually used in the transaction and any commission. In the contract, check the rules for establishing exchange rate tables and the possibility of repayment directly in the currency of the obligation.

The rate determining the interest rate on one-day deposits placed by banks at the National Bank of Poland.

It is an element of monetary policy tools. It does not directly determine the interest rate on the client's deposit or the price of a specific loan.

In practice: Do not equate the basic NBP rates with the bank's interest rate table.

Source: NBP - basic interest rates.

The rate used by NBP when discounting bills of exchange in accordance with the rules of the relevant central bank instrument.

It concerns a specific type of operation and differs from the reference and rediscount rates. You should not arbitrarily substitute it into the loan cost calculator.

In practice: Check the exact name of the pointer that a given enum requires.

Source: NBP - rules for discounting bills of exchange.

One of the basic NBP rates, relating to the interest rate on lombard loans granted to banks by the central bank.

It is not the NBP reference rate or the automatic interest rate on every consumer loan. Individual legal limits may refer to different indicators.

In practice: When calculating interest, determine the appropriate rate and its effective date.

Source: NBP - basic interest rates.

One of the basic rates of the central bank, set by the Monetary Policy Council. It influences money market conditions and is an element of some statutory interest formulas.

In practice: It is not the same as WIBOR, EURIBOR or APRC. Not every contract changes the interest rate immediately after the Monetary Policy Council's decision. Always check the specific update mechanism described in the product documents.

The interest rate reference index used in some financial agreements in PLN. In many variable-rate loans, it appears along with the lender's margin.

In practice: The indicator variation and update frequency should be specified in the contract. A change in WIBOR does not necessarily translate into an installment immediately. Also check the rules of conduct in the event of a change or discontinuation of publication of the indicator.