Credit Configurations

Lithic’s commercial revolving credit platform gives you a robust set of configuration options to create a revolving credit card product that perfectly fits your customers’ needs. You can work with your Lithic implementation specialist to understand best practices and get guidance in setting up your configuration. This guide walks through the configuration options available.

Credit Products are also used as part of Charge Card programs, but with much more limited options

1. Billing Cycles

Fixed Billing Cycles: Select a fixed monthly cycle that aligns with calendar dates (e.g., 25th of every month), offering predictability in billing and payment dates.
Rolling Billing Cycles: Choose a rolling cycle that adjusts based on each customer’s account opening date (e.g., every 15 days), providing flexibility in individual billing timelines.

2. Grace Period

Configurable Grace Period: Set a grace period (e.g., 15 days) post-billing, allowing users to settle their balances without incurring interest. This period can be adjusted to meet compliance or user-friendly standards. Grace period can be at most the length of the billing cycle.

3. Interest Categories

Purchase: Define the standard interest rate for purchases.
Promotional: Offer promotional interest rates for specific purchases or periods, which can help attract customers.
Cash Advance: Configure a distinct rate for cash advances to manage higher-risk transactions.
Penalty: Set penalty rates for delinquent accounts to mitigate risks associated with non-payment.
Balance Transfer: Offer competitive rates for balance transfers, which attract users looking to consolidate debt.

4. Tiers

Tiered Structures: Apply a bundle of criteria to a certain category of customer depending on the types of business or risk profile.

5. Automated Fees

Trigger Events: Configure when fees are applied, such as for late payments or returned payments.
Maximum Occurrences: Limit how frequently each fee type (e.g., returned payment) can be charged within a billing cycle.
Types of Fees:
- Returned Payment Fee: Configure the amount and the max number of fees that can be assessed when a payment is returned.
- Late Payment Fee: Define the fee for a missed payment for every missed period, with the ability to cap the number of charges.
- FX Fee: Apply a foreign transaction fee, as a percentage of the transaction amount, when customer spend in a foreign country.

7. Payments

Minimum Payment: Set the minimum payment requirement per billing cycle, ensuring customers meet a base-level payment.
Statement Balance Payment: Allow payment of the full statement balance to avoid accruing interest.
Pay Other Amount: Offer customizable payment amounts beyond the minimum, giving customers flexibility in managing their balances.

8. Credit Limits

Business-Level Limits: Establish credit limits based on defined criteria, offering maximum control over total credit exposure.
Card-Level Limits: Establish limits on the cards themselves by setting them on an account-level, which can be adjusted for specific purposes like spend control on Lithic’s ASA apis.

9. Rate Adjustments & Caps

Prime Rate Linking: Lithic exposes the ability for you to adjust certain interest rates (e.g., for purchase or cash advance categories) in alignment with changes in the prime rate, providing flexibility in dynamic interest rate environments.
Set Interest Caps: Define maximum interest rates for all categories to stay compliant with regional regulations and ensure customer transparency.

10. Delinquency Management

Charge-Off Policy: Define parameters for when an account becomes charged-off due to extended delinquency (e.g., 120 days past due). After an account is charged-off, spending is restricted, but recoveries (post-charge-off payments) are allowed.