You can settle your loan early at any time, and doing so usually saves you money. When you settle early there may be an early-settlement charge — here is exactly what it is, when it applies, when we waive it, and why settling early is still worth it.
The plain meaning
If your company chooses to repay the loan ahead of schedule, an early-settlement charge of up to 28 days' interest may apply. It is calculated from your own loan's figures — never invented — and it is the only charge for settling early. The exact amount, if any, is always shown in your settlement figure before you confirm, so you decide with the number in front of you.
When we waive it
We waive the early-settlement charge automatically in many cases. You will not pay it if your company is in financial difficulty, if settling early would not actually leave you better off, or in recognition of a consistent record of good standing. Because the decision is made from your own circumstances and recorded, the figure you see in your settlement quote already reflects any waiver — there is nothing to claim or ask for.
Why early repayment still saves you money
On our loan, interest accrues over the time you actually hold the money. The total amount payable shown on your Key Information Sheet (KIS) assumes you run the loan for the full term. If you settle sooner, you stop the remaining interest from accruing — so even after any early-settlement charge of up to 28 days' interest, you usually pay less than the original total. The earlier you settle, the more of the remaining interest you save. Our detailed walk-through is in early repayment: how and what you save.
How it works, in practice
Suppose a company takes a short-term loan over the full term but finds it can clear the balance partway through, when an expected payment arrives early. It asks for a settlement figure, which shows the balance, the interest accrued to the settlement date, and any early-settlement charge — already reduced or waived where that applies. The company pays that figure, the loan closes, and it has stopped the interest it would otherwise have paid over the rest of the term.
This is an illustration of the principle, not a quote — your figures are on your KIS and in your settlement quote, and the exact amounts depend on your loan and when you settle.
Getting a settlement figure
To repay early, you ask us for a settlement figure: the exact amount needed to clear the loan in full as at a given date, with any early-settlement charge (or waiver) already applied. Because interest stops accruing once the loan is settled, the figure is tied to the date you pay. The process is set out in how do I get a settlement figure. Always settle against an up-to-date figure rather than guessing, so the loan is cleared cleanly.
What it does not mean
To be clear about the limits: an early-settlement charge does not mean the borrowing is free, and settling does not erase interest that has already accrued for the time you have held the money. You still pay back what you borrowed plus interest up to settlement, plus any early-settlement charge that applies. What settling early does is stop the future interest — which, for most loans, is the larger number.
The takeaway
Settling early is still a borrower-friendly move: if the company can clear the loan early, it usually should, because it stops the remaining interest, and the early-settlement charge is capped at 28 days' interest and waived in many cases. If you think you may be able to settle ahead of schedule, ask us for a settlement figure — the exact cost, including any charge, is in front of you before you commit.