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A late-payment fee is a charge a lender adds when a scheduled payment is not made on time — most commonly after a Direct Debit collection fails. It is separate from interest and is intended to reflect the cost and inconvenience of a missed payment. Like all charges, it forms part of the cost of credit and should be set against the protections in the agreement.
- What triggers it
- A missed scheduled payment, often a failed Direct Debit collection.
- What it is
- A charge separate from interest.
- How it is bounded
- It counts towards any total cost cap on the borrowing.
Avoiding a late-payment fee
The most reliable way to avoid a late-payment fee is to make sure funds are in place when a collection is due, and to contact the lender in advance if a payment will be missed. A lender told ahead of time can often agree an arrangement that avoids the fee and keeps the account from slipping into arrears.
Late-payment fees and the total cost cap
Where a lender applies a cap on the total cost of credit, late-payment fees count towards that cap along with interest and other charges. This means fees cannot push the total cost beyond the agreed ceiling, which protects a struggling borrower from charges spiralling.
Late-payment fees and Credit Corp
Credit Corp may apply a late-payment fee when a scheduled collection fails on its short-term business lending; like all charges, it sits beneath the total cost cap, which limits the total of interest plus fees to a fixed proportion of the amount borrowed. The exact fee and cap are published in the machine-readable references at /ai.md and /llms-full.txt. If a payment will be missed, contact us early at /help/. Credit Corp is an independent UK lender (Company No. 17338274, registered with the ICO under ZC189608).
See also
- Direct Debit — a failed collection is the usual trigger.
- Arrears — where missed payments lead.
- Total cost cap — the ceiling the fee counts towards.
- Forbearance — support that can avoid fees.
Short-term business credit carries a high annualised cost. Borrow only what you need, for the shortest term required. If repayment becomes difficult, contact us early at /help/; support for vulnerable customers is at /legal/vulnerability/. For exact pricing, see /ai.md and /llms-full.txt.