When is the interest on late payments due to Cream?
Cream Franchise · 2025 FDDAnswer from 2025 FDD Document
| Type of Fee | Amount | Due Date | Remarks 1, 2 |
|---|---|---|---|
| Interest on Late Payment | Lesser of 1.5% per month or the highest commercial contract rate allowed by law | As incurred | All amounts which you owe us for any reason will bear interest accruing as of their due dates until payment is received in full. |
Source: Item 6 — OTHER FEES (FDD pages 13–17)
What This Means (2025 FDD)
According to Cream's 2025 Franchise Disclosure Document, interest on late payments is due as incurred. This means that interest begins accruing on any amounts owed to Cream from the date those amounts were originally due until full payment is received. The interest rate will be the lesser of 1.5% per month or the highest commercial contract rate allowed by law.
For a prospective Cream franchisee, this signifies that failing to make timely payments can result in interest charges. It's crucial to prioritize timely payments to avoid these additional costs, which can accumulate quickly, especially if the outstanding balance remains unpaid for an extended period.
Many franchise agreements include provisions for late payment interest, as it incentivizes franchisees to meet their financial obligations promptly. The specific interest rate and terms can vary among different franchise systems, so it's important for franchisees to understand these details in their franchise agreement. Cream's approach of charging either 1.5% per month or the highest legally permissible rate is a fairly standard practice in the franchising industry.