{"section":"tutorials","requestedLocale":"en","requestedSlug":"how-to-choose-the-type-of-interest-for-a-payment-condition","locale":"en","slug":"how-to-choose-the-type-of-interest-for-a-payment-condition","path":"docs/en/tutorials/payments/transactions/how-to-choose-the-type-of-interest-for-a-payment-condition.md","branch":"main","content":"While setting up a payment condition, you can choose to configure [installments with interests](/en/docs/tutorials/how-to-configure-payment-conditions#installments-with-interest). Then, you have to decide if you want to use simple or compound interests.\n\n## The difference between simple and compound interests\nBefore choosing the interest type, you must understand the difference between the two of them. The __simple interest__ is levied on the total price of the order. On the other hand, the __compound interest__ is based both on the total value and the amount of interest accumulated between installments.\n\nWhile compound interests are the most common in Brazil, countries such as Argentina prefer the use of simple interests.\n\n## How to define the type of interest\n1. In the VTEX Admin, go to **Store Settings** > **Payment** > **Settings**, or type **Settings** in the search bar at the top of the page.\n2. You'll be redirected to the settings page, where you must click on the __Payment Conditions__ tab.\n3. Choose the payment condition you want to edit or [configure a new one](/en/docs/tutorials/how-to-configure-payment-conditions).\n4. In the payment condition setup page, click on the __In installments__ option (on the __In cash or in installments?__ module).\n5. Fill in the number of installments you want to offer (unless this has already been done), then click on the __Set installment taxes__ button. By doing this, a detailed list will show the installments, with dedicated fields to edit the interest rate.\n6. At the end of the list, a message informs the type of interest used. __Compound interests__ are set by default, so you need to click on __Change__ if you want to use __simple interests__.\n7. A select field will appear, and you'll be able to choose between simple or compound interests.\n8. After finishing the other configurations (like [special conditions](/en/docs/tutorials/special-conditions/), for example), click on the __Save__ button."}