: Mate interest has four components: a. Net interest: The capital that is taken as a loan , the financial value of the capital is calculated only by the amount to be paid, that is net interest. B. Risk bearing insurance: When the lender lends , he takes the risk. Therefore, due to the risk, the lender receives something more than the net interest from the borrower. This additional receipt includes mate interest. C. Debt Consolidation Loans - Getting a Debt Consolidation Loan, Even With Poor Credit For example , if you give a loan to someone for 5 years, even if he needs money before that time, he will not get it back from the borrower. So once the loan is given, he has to be in trouble for some time. Receipt of some money as cost of that inconvenience may include interest. D. Management Rewards: Every lender has to bear some of the cost of arranging the loan. For example, he has to keep his account book , give time and even go to the door of the borrower. For all these reasons, lenders expect to receive some money on top of pure or net interest. Thus some of the money received as a management reward is included in the matt interest. Therefore, mature interest means the extra money claimed as remuneration with net or net interest - the combined receipt of all this. Thus it can be said that the expected receipt for the incidental expenses incurred by the lender with net or net interest is called mat interest.