5-12.6 Interest

The Postal Service will pay interest on late payments and unearned prompt payment discounts in accordance with the Prompt Payment Act, 31 U.S.C. 3901 et. seq., as amended by the Prompt Payment Act Amendments of 1988, P.L. 100-496, in accordance with Clause 4-1: General Terms and Conditions, paragraph i, or Clause B-22 : Interest. Interest on late payments made will be paid automatically by the Postal Service to the supplier when the following conditions are met:

• A proper invoice has been received and processed; there is no disagreement over quantity, quality, or other contract provisions; and 30 days have passed.
• An improper invoice has been received; the CO has failed to notify the supplier; and 7 days have passed since receipt.

When a prompt payment discount is taken after the discount date has expired, the Postal Service has 10 days after this expiration to correct the underpayment by making the remainder of the nondiscounted payment amount. Failure to do so will result in automatic payment of interest, no matter if the supplier has requested the payment of interest or not. Interest will be calculated beginning with the first day after the discount date through the date the supplier is paid in full. The percentage of interest to be paid and successively applied to the payment is calculated by, and in accordance with:

• Clause 4-1: General Terms and Conditions, paragraph i, or Clause B–22 : Interest.
• Prompt Payment Act, 31 U.S.C. 3901 et. seq., as amended by the Prompt Payment Act Amendments of 1988, P.L. 100—496.
• The interest rate due a supplier will be published in the Postal Bulletin.