Skip to content
Not a Fintech Company

Term Loan Unit Economics

Model the profitability of a single fixed-term consumer loan from the lender's side — revenue, cost of funds, servicing, losses, and net profit per loan.

Loan terms
$
%
months
% of amount
Lender economics
% annual
$/month
%
$ one-time

Modeling assumptions

  • Loss rate is treated as a constant annual rate applied to average outstanding balance. Real-world charge-offs follow vintage curves — losses are heavier in months 6–24 — so this is a smoothed approximation.
  • No prepayment modeling. The loan is assumed to run full term.
  • CAC is treated as a one-time origination cost, not amortized over the life of the loan.
  • All figures are nominal — no time-value-of-money discounting. To analyze NPV, IRR, or capital deployment, use the full economics model.
  • ROA is computed per-loan over the life of the loan, not annualized. To compare loans of different terms, divide ROA by term / 12.

The underlying Google Sheets model covers a broader portfolio view including portfolio-level revenue ramp, charge-off timing, and capital deployment.