# Fees

Trilobyte charges two types of fees to sustain the protocol and incentivise responsible management.

## Protocol Fee

A **0.5% fee** (50 basis points) is charged on two types of transactions:

| Transaction           | When                          | Example                                                       |
| --------------------- | ----------------------------- | ------------------------------------------------------------- |
| **Investor deposits** | During the RaisingFunds phase | 100,000 USDC deposit → 500 USDC fee → 99,500 USDC credited    |
| **Loan repayments**   | During the Active phase       | 10,000 USDC payment → 50 USDC fee → 9,950 USDC split to pools |

The protocol fee is deducted automatically and transferred to the **protocol treasury** address stored in the Globals contract.

### Fee Configuration

* The default fee is set to `50_000` in 7-decimal format (0.5%)
* The fee can be updated by the Governor via `set_fee(caller, fee)` on the Globals contract
* Fee changes go through the **Timelock** for governance delay

{% hint style="info" %}
The protocol fee is intentionally low to encourage participation. It covers operational costs and funds protocol development.
{% endhint %}

## Late Fees

When a borrower misses a payment deadline, the Pool Manager can apply a **late fee** penalty.

* **Rate**: 18% per annum on the overdue amount
* **Applied by**: The Pool Manager via `apply_late_fee(caller)`
* **Condition**: Can only be applied when `now > next_due` (payment is overdue)
* **Effect**: Increments the missed payments counter and advances the next due date (prevents double-charging)

Late fees are calculated as:

$$
\text{late\_fee} = \text{overdue\_amount} \times \frac{18%}{12}
$$

Late fees accumulate in the vault's `late_fees` balance and serve as a signal of vault health. They are tracked on-chain via the `LateFeeApplied` event.

## Fee Summary

| Fee          | Rate     | Charged On            | Recipient | Set By                  |
| ------------ | -------- | --------------------- | --------- | ----------------------- |
| Protocol fee | 0.5%     | Deposits & repayments | Treasury  | Governor (via Timelock) |
| Late fee     | 18% p.a. | Overdue payments      | Vault     | Pool Manager            |


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