Paying interest on a monthly basis and paying back the money at maturity is a loan method. During the loan period, only the interest needs to be repaid, and there is no need to repay the principal. Simply put, you only need to pay interest every month and return the loan principal in one lump sum when it is due.

This repayment method has less pressure and only needs to pay a small amount of interest every month. However, this method is not common because of the high risk of overdue. Generally speaking, this method is suitable for seasonal or phased enterprises, and lending institutions will provide loans to these enterprises.