The concept of Creditor (lender) and Debtor (borrower) impacts two things primarily:
Who charges interest (creditor/lender), and who pays interest (debtor/borrower); and
Who appears as the owner of the loan on the Balancer dashboard
What are the default settings?
When setting up an intercompany loan in Mayday, by default the creditor will automatically be set to the entity with the debit balance (i.e. it is an asset), and the debtor will be the entity with the credit balance (i.e. it is a liability).
For example, in this screenshot it is Mayday HQ with the debit balance. So they would be considered the creditor if they were to charge interest.
Automatic swapping of creditor/debtor based on loan balance
If you go with the default settings, the creditor and debtor will automatically swap if the balance of the loan swaps. So if entity A was originally the creditor and had the debit balance. If that balance suddenly falls to credit, that would automatically make entity B the new creditor.
How can I set the creditor to the entity I want?
If you want to avoid Mayday automatically setting and changing the creditor/debtor, you can override the defaults by ticking the box that says "This entity should always be the creditor for this balance".
