Myöhästymiskorko

Myöhästymiskorko, which translates to default interest or late payment interest in English, is a legally defined interest rate applied to overdue payments in Finland. It serves as compensation for the creditor when a debtor fails to pay an amount by the agreed-upon due date. The purpose of myöhästymiskorko is to encourage timely payments and to cover the costs and potential financial losses incurred by the creditor due to the delay.

The applicable rate for myöhästymiskorko is set by the Bank of Finland and is typically updated twice a year. This rate is based on the European Central Bank's main refinancing rate. When the main refinancing rate changes, the myöhästymiskorko rate is adjusted accordingly. The specific rate is published by the Ministry of Justice.

Myöhästymiskorko applies to various types of debts, including consumer credit, business transactions, and loans. It is calculated from the day following the due date until the day the payment is received. If a debt is not paid by its due date, the debtor is liable to pay this interest in addition to the principal amount. The calculation is straightforward, based on the outstanding amount and the prevailing myöhästymiskorko rate for the period of delay. This mechanism is a standard part of credit and payment agreements to ensure financial fairness.