Setting the arrears rate

Where the daily rate and grace days live: per loan, and global for recurring services.

Arrears are configured in two different places, and mixing them up is the usual cause of "why did it not charge arrears?".

	Loans	Recurring services
Daily rate	Per loan	Global for the business
Grace days	Per loan	Per service contract
Where to change it	Loan record	Settings → Accounting
Who can	Anyone with the arrears permission	Account owner only

Loans: the rate lives on each loan

There is no company-wide arrears rate for loans. Every loan carries its own, set when you create it:

Arrears rate (% per day): how much is surcharged per day late on the pending installment. Example: 1 = 1% daily.
Grace days: how many days late are forgiven before charging starts.

Both fields are optional and default to 0. A loan created without an arrears rate never accrues arrears, no matter how late it gets. This is the number-one reason for "the system did not compute my arrears".

Changing them later

From the loan record you can adjust the rate and the grace at any time (requires the update arrears permission; a collector can only do it on loans assigned to him).

Careful: the change applies to the full recomputation, not "from now on". Because arrears are not stored but recomputed on the fly (see How arrears are calculated), raising the rate today also makes the days already elapsed more expensive on installments not yet collected. Arrears already collected in past payments are untouched: those are closed.

To forgive arrears for a specific client you have two routes: lower the rate / raise the grace on that loan, or simply collect with the Arrears field at 0 when recording the payment.

Recurring services: one rate for the whole business

For service contracts (recurring billing) the logic is the opposite: a single daily rate for the whole business, under Settings → Accounting → Service arrears rate.

Expressed in % per day (for example 0.5 = 0.5% daily on the overdue balance).
0 disables service arrears for every contract.
Accepts up to 4 decimals and cannot exceed 100%/day (a sanity cap: a daily rate above 100% is almost always a typo).
Only the account owner can change it. It is not delegable to a collector: it defines how much extra a late client is charged.
Grace days are per contract (10 days by default), so you can be flexible with one client without touching the global rate.

Every change to this rate is recorded in the audit trail with who did it and when.

Practical advice

Pick a standard rate and grace for your business and apply them to every new loan out of habit. A loan with 0 arrears is rarely a deliberately surcharge-free loan: usually it is a loan whose arrears settings were forgotten.