Thank you kind sir

So to confirm my understanding, the cash interest that I receive as a lender/debt provider is 12% x 90/360.

To add, as the debt provider/debt investor, though the cash interest received is 12% x 90/365, my financial return is 12.6%, on a compounded return basis / IRR? and the convention is to quote annualized figure i suppose?

I’m trying to clear up my conceptual concepts here:

"Annual percentage yield (APY) (or in CFA, its the effective annual yield/rate,IRR) —

The annual amount you actually pay… , including compounding and other charges, expressed as a percentage of the loan amount. This is the most comprehensive measure of the cost of a loan, but because it includes non-guaranteed fees, it often can’t be calculated until after a loan is repaid. "(https://napkinfinance.com/napkin/whats-apr/)

Put differently, i’m trying to close my knowledge gap here. where does the additional 0.6% come from, if I receive/the borrower pays 12% x 90/360. lets not even talk about the additional yield that 365/360 generates first.