Late payment interest calculator

France (Code de commerce)

France is in the EU, but euro‑area member states may set higher statutory rates than the Directive minimum. Under Article L441‑10 of the French Commercial Code, the default rate for late payment in commercial transactions is the ECB MRO rate + 10 percentage points, using the rate in force on 1 January and 1 July (i.e., updated twice yearly).

Keep in mind

• If the contract specifies a different late‑payment rate, the agreed rate applies (subject to statutory minimums).
• In public procurement, the statutory late‑payment interest is ECB MRO + 8 percentage points under the Code de la commande publique (see Article R2192‑31).

Germany (BGB § 288)

Germany uses the official base rate (Basiszinssatz) set by the Deutsche Bundesbank, updated twice yearly (1 January and 1 July). Statutory late‑payment interest adds a margin to that base rate under § 288 BGB.

Default statutory rates

• B2B / non‑consumer debts: Basiszinssatz + 9 percentage points.
• Consumer debts: Basiszinssatz + 5 percentage points.

Recovery cost compensation

The €40 recovery cost compensation applies only to non‑consumer debts. It does not apply when the debtor is a consumer.

These are default statutory rates. Certain transaction types can have different rates under German law (for example, some public‑authority payment regimes).

UK statutory interest (Late Payment of Commercial Debts)

The Late Payment of Commercial Debts (Interest) Act 1998 applies across England, Wales, Scotland and Northern Ireland for certain commercial (business-to-business) debts. It does not apply to consumer debts. Statutory interest is 8% per year above the Bank of England base rate, calculated on a daily basis for the late period.

Fixed compensation (recovery costs)

You can also add a fixed sum once per late invoice: £40 (up to £999.99), £70 (£1,000–£9,999.99), or £100 (£10,000+).

Note

If your contract already specifies a different late payment interest rate, statutory interest may not apply. The applicable statutory rate can also change if the Bank of England base rate changes while the invoice remains unpaid (the overdue period).

Switzerland (calculator available)

Switzerland is not in the EU/EEA. Under Swiss law, default interest on monetary obligations is generally 5% per annum. This calculator applies a fixed 5% rate; if your contract uses another rate, use the custom option. The Swiss approach is a different structure from “reference rate + margin”, and it is typically driven by the Swiss Code of Obligations (Arts. 104–105).

Useful source: Swiss Code of Obligations, Art. 104

Sweden (räntelagen)

Swedish statutory late‑payment interest is governed by the Interest Act (räntelagen). For commercial late payments, the statutory rate is the Riksbank reference rate + 8 percentage points. The reference rate can change (typically on 1 January and 1 July), so longer overdue periods should be calculated in rate segments.

Fixed recovery cost compensation (SEK 450)

In addition to interest, Swedish law provides a fixed compensation amount of SEK 450 for recovery costs in B2B/commercial transactions. It does not apply to consumer debts.

How this calculator works

This option uses the historical Riksbank reference rate and calculates interest as (reference rate + 8%), pro‑rated by the number of late days. It also adds the fixed SEK 450 compensation.

Norway (calculator available)

Norway sets statutory late payment interest (“forsinkelsesrente”) and a standard compensation amount on a half‑yearly basis, effective from 1 January and 1 July. The standard compensation applies only to B2B (non‑consumer) debts. The current tool applies those published rates and shows the standard compensation separately.

Useful source: Finanstilsynet / Norwegian Financial Supervisory Authority

EU (non‑euro member states)

The EU Late Payment Directive (2011/7/EU) sets a common framework for late payment in commercial transactions. Where it applies, the creditor is generally entitled to statutory late payment interest and a minimum fixed compensation amount for recovery costs.

Key point: the reference rate is national (not the ECB MRO rate)

For EU Member States whose currency is not the euro, the Directive defines the “reference rate” as the equivalent rate set by that country’s national central bank. So you cannot automatically use the ECB MRO rate outside the euro area—each country’s statutory calculation must be tied to its own national reference-rate mechanism and national implementing legislation.

What this means in practice

• The “base” reference rate is country-specific (set/published nationally).
• The statutory margin and any fixed compensation are implemented in national law (and can have local nuances).
• Rates may change over time, so longer overdue periods often need to be calculated in segments.

Countries in this category

Denmark, Poland, Czechia, Hungary and Romania are EU Member States outside the euro area (and therefore use national reference‑rate mechanisms under the Directive’s definition).

Useful sources (for verification)

For each country, the most reliable starting points are:

• The national central bank page that publishes the relevant policy/reference rate series.
• The national statute/guidance implementing the Directive.

Country sources

🌍 Non‑EU Europe

Outside the EU, late payment interest is governed by national law, and the applicable rate (and any fixed compensation) can work very differently from the EU Directive model. This section summarises the main statutory approach in selected non‑EU jurisdictions.

Ukraine

Ukraine uses its own statutory approach. A common framework for monetary obligations in delay is found in Article 625 of the Civil Code of Ukraine, which (in general terms) provides for compensation tied to the inflation index for the delay period and 3% per annum on the overdue amount, unless a different rate is set by contract or law.

Türkiye

In Türkiye, there is a specific commercial framework for late payment in the delivery of goods and provision of services under Article 1530 of the Turkish Commercial Code. The Central Bank of the Republic of Türkiye publishes the default interest rate and a minimum compensation amount for recovery costs used in that context. Separately, Türkiye also has a broader “legal/default interest” regime (Law No. 3095) that may be relevant in non‑commercial or different obligation types, and the applicable rate can change over time by official decision.

Useful source: CBRT table for TCC Art. 1530 (default interest + minimum compensation)

Orgalim (previously called Orgalime) standard terms

Orgalim, a pan-European trade association representing the engineering and technology industries, has developed standard sales terms. These are widely used in Europe and internationally for B2B supply and installation contracts. This calculator applies the late-payment mechanism used across S2012, S2022, SI14, and SI24.

Late payment interest under Orgalim terms:

• 8 percentage points above the ECB main refinancing operations (MRO) rate
• + 1% flat recovery cost compensation on the overdue amount

The MRO rate changes over time; this tool applies the correct historical periods and gives a full breakdown from the due date. Compared with the EU directive, Orgalim uses a percentage recovery cost instead of a fixed EUR 40 amount.

The various Orgalim standard terms and conditions are copyrighted documents owned and maintained by Orgalim aisbl. Please refer to the Orgalim web site for further information and for purchasing a copy of the legal documents.

United States

No single federal statutory late‑payment interest rate

For ordinary commercial invoices in the United States, there is no single federal statutory late‑payment interest rate that automatically applies nationwide. If interest is recoverable at all, the outcome usually depends on:

• the contract terms (what the parties agreed); and
• state law rules that apply when the contract is silent (and those rules vary by state and by claim type).

In other words: in the US, the contract usually does the heavy lifting.

What if the contract is silent?

If the contract does not specify late‑payment interest, the creditor can still claim the unpaid principal. Whether additional interest is recoverable typically depends on state law and the nature of the claim. In many states, a court may award prejudgment interest (interest up to judgment), particularly where the debt is a fixed or readily ascertainable amount and the delay is simply non‑payment. The rate and rules vary widely by state (and sometimes by claim type), so there is no single “default” US late‑payment rate.

Practical tip: If you want predictable results, include a clear interest clause in the contract. If the contract is silent and the amount is substantial, consult counsel on the applicable state’s prejudgment interest rules before asserting a specific rate.

Practical drafting guidance

1. State the rate clearly (and the basis)

   If you want predictable interest, specify:

   • the interest rate (e.g., “1.5% per month” or “12% per annum”), and whether it’s simple or compound;
   • how interest accrues (daily/monthly);
   • when interest starts (due date, day after due date, after a grace period, etc.); and
   • whether partial payments are applied first to costs/interest or principal.

   Avoid ambiguity like “late fees apply” without numbers or definitions.

2. Watch state “usury” limits and characterisation

   Many states regulate “interest” and/or “finance charges” (often called usury rules). Even in a business‑to‑business context, an aggressive late‑payment rate can become unenforceable, or get recharacterised as a penalty depending on the state and context.

   Practical approach:

   • Keep late‑payment interest commercially defensible (don’t write a “punitive” number).
   • Consider including a “maximum lawful rate” safety valve (see sample clause below).

3. Decide whether you want “interest”, a “late fee”, or both

   A late fee can be useful, but it’s the area most likely to be attacked as a penalty if it looks disproportionate to the harm.

   If you use a late fee:

   • tie it to plausible administrative costs;
   • make it one‑time (per invoice) rather than recurring unless you have a reason; and
   • avoid stacking a large late fee plus a high interest rate unless you can justify both.

4. Set the payment mechanics (this prevents disputes)

   Interest clauses fail in practice when the “due date” is unclear. Useful mechanics:

   • when an invoice is deemed received (email counts?);
   • whether invoice disputes must be raised within a short period;
   • whether undisputed amounts must still be paid; and
   • whether the buyer can withhold payment for unrelated disputes.

5. Add recovery costs and enforcement language (where appropriate)

   In the US, recovery of attorneys’ fees and collection costs often depends on contract language. If you want that protection, say so explicitly (and keep it reasonable).

   Typical items:

   • “reasonable costs of collection”
   • attorneys’ fees
   • court costs
   • agency fees (if you use collection agencies)

6. Choose governing law and venue intentionally

   Because state law varies so much, governing law can matter as much as the rate itself. Don’t pick a state casually; pick one that matches the transaction and your enforcement strategy. Also consider venue/jurisdiction provisions so you can actually enforce.

7. Consider industry and counterparty context

   Some areas have special rules (public authorities, construction payment regimes, consumer transactions). A good “commercial invoices” clause can be inappropriate in consumer contexts.

Examples of a late‑payment interest clause

This is an example of what a late‑payment interest clause in a contract could look like (not a one‑size‑fits‑all clause):

(Keep $Y modest unless you have a real story for it.)

Note to visitors from the United States

This site primarily focuses on Europe and selected non‑EU jurisdictions. This US section is provided as general information to explain why US late‑payment interest is typically driven by contract drafting rather than a single nationwide statutory rate. If you have suggestions for useful additions, we welcome feedback.

Canada

There is no single nationwide statutory late payment interest rate for ordinary commercial invoices.

The applicable interest (if any) typically depends on:

• the contract terms (what the parties agreed), and
• provincial law rules that may apply when the contract is silent.

Practical approach

If you want predictable late payment interest in Canada, include clear payment and interest terms in your contract (rate, when interest starts, compounding or simple interest, and any fees).

Note to our good friends in Canada

This site currently focuses on Europe. This section is purely for informational purposes. If you have any ideas for additional content, we'd love to hear from you!