The centimeter is the unit of measurement, which means one thousandth (that is, 0.00 1). Therefore, the loan interest of 5% means that the annual interest rate is 5%, that is, 5% of the loan principal needs to be paid as interest expense every year.
Interest rate is an important concept in banking. Different types of bank credit products have different interest rate calculation methods.
Bank loans set different interest rates according to different repayment periods or repayment methods. Loan interest is usually calculated on an annual basis, and the specific payment method is agreed in the contract. In Chinese mainland's banking system, "5%" is a unit of measurement that has been eliminated, and now the percentage method or thousandth method is commonly used.