What is the maximum interest rate that a Bambu franchisee can be charged for late payments?
Bambu Franchise · 2025 FDDAnswer from 2025 FDD Document
In the event that Franchisee fails to have sufficient funds in its account or otherwise fails to pay the Marketing and Technology Fee, Royalty Fee, or other payments due to Bambu as of the date due, Franchisee shall owe in addition to the Marketing and Technology Fee, Royalty Fee, or other amounts due, interest at the highest applicable legal rate for open account credit, not to exceed 1½ percent per month.
Franchisee acknowledges that this Section 12.5 shall not constitute Bambu's or its affiliates' agreement to accept such payments after they are due or a commitment to extend credit to or otherwise finance operations of the shoppe.
In no event shall Franchisee be required to pay interest at a rate greater than the maximum interest rate permitted by applicable law.
Source: Item 23 — Receipts (FDD pages 52–209)
What This Means (2025 FDD)
According to Bambu's 2025 Franchise Disclosure Document, a franchisee may incur interest on late payments. Specifically, if a Bambu franchisee fails to pay the Marketing and Technology Fee, Royalty Fee, or other payments by the due date because of insufficient funds or any other reason, they will owe interest on the overdue amount.
The interest rate will be the highest applicable legal rate for open account credit, but it will not exceed 1½ percent per month. The FDD also states that in no event shall Franchisee be required to pay interest at a rate greater than the maximum interest rate permitted by applicable law.
It is important to note that this late payment clause does not obligate Bambu to accept late payments or extend credit to the franchisee. Bambu also reserves the right to assess a $50 late fee for any late Marketing and Technology Fee or Royalty Fee payment.