Credit Act 1984

For the purposes of this Act, a reference to a credit charge—

in relation to a credit sale contract or a loan contract, is a reference to the amount by which the amount payable under the contract by the debtor to the credit provider or a person on his behalf (not including amounts of deferral charges, default charges or enforcement expenses) exceeds the amount financed; and

in relation to a billing cycle of a continuing credit contract, is a reference to a credit charge within the meaning of section 54.

For the purposes of the interpretation of accrued credit charge in relation to a credit sale contract or a loan contract, the amount of the credit charge which has accrued at a particular time may be calculated—

by adding together the amounts ascertained by applying the daily percentage rate to the unpaid daily balances (being daily balances before that time)—

in the case of a credit sale contract—of the amount financed; or

in the case of a loan contract—of the amount financed other than any part of the amount agreed under the contract to be lent that has not been lent at that time;

where Schedule 1 applies to the credit sale contract or loan contract—in accordance with the formula set out in that Schedule; or

where an applicable method is prescribed for the purposes of this subsection—in accordance with that method.

In calculating the amount of a credit charge which has accrued under a credit sale contract or a loan contract, the credit provider may, if he so determines, apply a percentage rate per annum that is lower than the annual percentage rate disclosed under the contract.