Installment Promissory Note Template for Switzerland

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Key Requirements PROMPT example:

Installment Promissory Note

"I need an Installment Promissory Note under Swiss law for a CHF 500,000 business loan to be repaid in monthly installments over 36 months, starting March 2025, with a 5% annual interest rate and secured by company equipment."

Document background
The Installment Promissory Note is a crucial financial instrument used in Switzerland when parties wish to formalize a loan agreement with structured repayment terms. This document is particularly relevant when a lender provides funds to a borrower who agrees to repay the amount through regular, predetermined installments. Governed by Swiss law, specifically the Swiss Code of Obligations (OR/CO), the note must meet specific legal requirements for validity and enforceability. It typically includes essential elements such as the principal amount, interest rate, payment schedule, and default provisions. The Installment Promissory Note serves as both a proof of debt and a binding commitment to repay, making it valuable for various business and personal lending situations where structured repayment is desired.
Suggested Sections

1. Identification of Parties: Full legal names and addresses of the Promisor (borrower) and Promisee (lender)

2. Principal Amount: Clear statement of the total amount being borrowed, expressed both in numbers and words

3. Promise to Pay: Explicit promise by the Promisor to pay the Principal Amount plus any interest

4. Payment Terms: Detailed specification of installment amounts, payment frequency, and due dates

5. Interest Rate: Specification of applicable interest rate (if any) and calculation method

6. Payment Application: Order in which payments will be applied (e.g., first to interest, then to principal)

7. Default Provisions: Consequences of missed payments and definition of events of default

8. Acceleration Clause: Conditions under which the entire balance becomes immediately due

9. Governing Law: Explicit statement that Swiss law governs the promissory note

Optional Sections

1. Security Interest: Include when the note is secured by collateral

2. Guarantee: Include when there is a personal or corporate guarantee for the debt

3. Prepayment Terms: Include if early payment is allowed or if there are prepayment penalties

4. Late Payment Penalties: Include if specific penalties or fees apply to late payments

5. Assignment Rights: Include if the note can be assigned or transferred to other parties

6. Insurance Requirements: Include if the borrower must maintain specific insurance

7. Notice Provisions: Include if specific notice requirements are needed beyond statutory requirements

Suggested Schedules

1. Payment Schedule: Detailed table showing all installment amounts and due dates

2. Amortization Schedule: Table showing breakdown of each payment between principal and interest

3. Collateral Description: Detailed description of any assets securing the note, if applicable

4. Guarantee Agreement: Attached guarantee document if a third party is guaranteeing the debt

Authors

Alex Denne

Head of Growth (Open Source Law) @ Genie AI | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Relevant Industries

Banking and Financial Services

Real Estate

Commercial Lending

Private Lending

Small Business

Corporate Finance

Investment Management

Manufacturing

Retail

Construction

Agriculture

Relevant Teams

Legal

Finance

Treasury

Credit and Collections

Risk Management

Compliance

Commercial Lending

Corporate Finance

Business Development

Investment

Relevant Roles

Chief Financial Officer

Finance Manager

Credit Manager

Loan Officer

Treasury Manager

Financial Controller

Legal Counsel

Compliance Officer

Risk Manager

Commercial Lending Officer

Business Development Manager

Account Manager

Collections Manager

Corporate Secretary

Investment Officer

Industries
Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks,  Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination,  Severance Pay, Governing Law, Entire Agreemen

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