What is interest on arrears in SAP SRD-FIN-ACR - FIN-Receivables?

SAP Term: interest on arrears

• Component: SRD-FIN-ACR

• Component Name: FIN-Receivables

• Description: An additional charge associated with the non-payment of an outstanding debt, calculated as a percentage of the original amount due.

Smart SAP Assistant

• Key Concepts: 
  Interest on arrears is a feature of SAP's Receivables Management component that allows customers to charge interest on overdue payments. This feature allows customers to set up interest rates and payment terms for overdue payments, and to automatically calculate and post the interest charges to the customer's account. 
  
  How to use it: 
  To use this feature, customers must first set up the interest rate and payment terms in the system. This can be done by entering the interest rate in the Interest Rate field in the Interest Calculation tab of the Customer Master Data. Customers can also specify a payment term for overdue payments in the Payment Terms tab of the Customer Master Data. Once these settings are configured, customers can then post interest charges to overdue payments by selecting the Post Interest Charges option in the Receivables Management menu. 
  
  Tips & Tricks: 
  It is important to note that customers must configure their interest rate and payment terms before they can post interest charges. Additionally, customers should ensure that their interest rate is up-to-date and accurate, as this will affect how much interest is charged on overdue payments. 
  
  Related Information: 
  For more information about setting up and using Interest on Arrears, please refer to SAP's documentation on Receivables Management. Additionally, customers can contact their SAP support team for assistance with configuring and using this feature.