What is the term for the rate of interest used to calculate periodic payments on a bond?

The term for the rate of interest used to calculate periodic payments on a bond is the stated interest rate. This is the rate that is specified in the bond's indenture and is used to determine the cash flow that investors receive from the bond in the form of coupon payments.

When a bond is issued, the stated interest rate is fixed and applies to the face value of the bond to calculate how much interest the issuer will pay to the bondholders at regular intervals, typically annually or semi-annually. For instance, if a bond has a stated interest rate of 5% and a face value of $1,000, the bondholder would receive $50 annually until maturity.

In contrast, other terms relate to different aspects of bonds. The effective interest rate refers to the actual cost of borrowing when considering fees and compounding interest, while yield to maturity represents the total return anticipated on a bond if it is held until maturity, taking into account current market price, coupon payments, and the time remaining until maturity. The coupon rate is another term often used interchangeably with the stated interest rate but typically refers to the actual interest payments received, whereas the stated interest rate defines the rate upon issuing the bond itself.