What is the maximum monthly interest rate that Cream charges on late payments?
Cream Franchise · 2025 FDDAnswer from 2025 FDD Document
All amounts which you owe us for any reason will bear interest accruing as of their due dates at the lesser of 1.5% per month or the highest commercial contract interest rate allowed by law. We will charge you the lesser of our then-current service fee, or the highest amount permitted by applicable law, per occurrence, for checks returned to us due to insufficient funds or in the event there are insufficient funds in the business account you designate to cover our withdrawals.
Source: Item 23 — RECEIPTS (FDD pages 61–192)
What This Means (2025 FDD)
According to Cream's 2025 Franchise Disclosure Document, any outstanding amounts owed to Cream will accrue interest from the due date. The interest rate will be the lesser of 1.5% per month or the highest commercial contract interest rate allowed by law. Cream also charges a service fee for returned checks due to insufficient funds, up to the maximum amount permitted by applicable law.
This means that if a Cream franchisee fails to make timely payments, they will be charged interest on the overdue amount. The 1.5% monthly interest rate could translate to a significant annual percentage rate (APR), so franchisees need to prioritize timely payments to avoid these charges. Franchisees should be aware of the applicable laws in their jurisdiction regarding commercial contract interest rates, as this could potentially be lower than the 1.5% stated by Cream.
Cream also has the right to apply any payments made by the franchisee to any past due debts, regardless of any specific designation the franchisee might make. Cream and its affiliates can also offset any amounts owed by the franchisee or their owners against any amounts Cream or its affiliates owe to them. This gives Cream considerable latitude in managing payments and debts, which franchisees should be aware of.