> For the complete documentation index, see [llms.txt](https://docs.syndromics.xyz/llms.txt). Markdown versions of documentation pages are available by appending `.md` to page URLs; this page is available as [Markdown](https://docs.syndromics.xyz/protocol/interest-and-repayment.md).

# Interest and repayment

Syndromics uses simple interest at a fixed annual rate. There is no compounding, no utilisation curve and no rate that can change after settlement.

## Accrual

Interest on a slice accrues per second:

```
interest = principal × aprBps / 10_000 × elapsedSeconds / 31_536_000
```

where `elapsedSeconds` is measured from the slice's start timestamp using `block.timestamp`. On Arbitrum-stack chains `block.number` reflects the L1 block, so the protocol never uses it for time.

Each slice accrues at its own APR. The borrower's total debt at any moment is the sum over slices of principal plus accrued interest.

## Minimum interest period

A loan carries a minimum interest period of **3 days**. Repaying earlier is allowed, but interest is charged as if the minimum period had elapsed. This prevents lenders being used as free intraday liquidity and keeps standing offers economical to maintain.

## Full repayment

`repay(loanId)` with the full outstanding amount:

1. Pulls principal plus accrued interest in USDG from the borrower.
2. Pays each slice its principal plus its own accrued interest, net of the protocol's interest share.
3. Burns the position NFTs.
4. Releases the full collateral to the borrower.
5. Emits `LoanRepaid`.

Repayment is never pausable. Even under an emergency pause of new loans and liquidations, borrowers can always repay and withdraw collateral.

## Partial repayment

`repay(loanId, amount)` with less than the full amount:

1. Applies the payment first to accrued interest across slices, then to principal, pro rata by slice principal.
2. Leaves the collateral in escrow.
3. Reduces the loan's LTV and raises its health factor accordingly.
4. Emits `LoanPartiallyRepaid`.

Partial repayment is the borrower's second tool, alongside top-up, for responding to a health-factor warning.

## Repayment through the L1 delayed inbox

If the sequencer is unavailable or censoring, a borrower can submit `repay` through Arbitrum's L1 delayed inbox. It will be force-included after the 24-hour delay. The protocol's liquidation grace period after a sequencer outage exists so that this path is genuinely usable. See [Sequencer and chain risk](/risk/sequencer-and-chain.md).

## Worked example

A borrower has a 20,000 USDG loan across three slices (5,000 at 8.50%, 10,000 at 8.90%, 5,000 at 9.00%) and repays in full after exactly 30 days.

| Slice | Principal | APR   | Interest (30d) |
| ----- | --------- | ----- | -------------- |
| 1     | 5,000     | 8.50% | 34.93          |
| 2     | 10,000    | 8.90% | 73.15          |
| 3     | 5,000     | 9.00% | 36.99          |
| Total | 20,000    |       | 145.07         |

The borrower pays 20,145.07 USDG. The protocol keeps 10% of the interest (14.51 USDG). Lenders receive their principal plus 90% of their slice's interest. Collateral is released in the same transaction.


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