# FAQs

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<summary>What Is A FlexPool?</summary>

FlexPool is a fancy name for a custom liquidity pool operated by an individual. They're created primarily for the benefits of accessing loans at little or no interest rate pushing the loan boundary beyond limit. It may be permissioned (for closed groups or friends) or permissionless (open to anyone). A worthy exception to creating a liquidity Flexpool is that the proposed unit liquidity cannot exist twice. Two FlexPools with the same unit contribution value cannot simultaneously exist. This was intended to avoid and reduce the possibility of spamming with unexpected behaviors. Example: If a pool of 100 USDT exists, and the epoch is active, a request to operate a pool with the same unit amount will not succeed until the existing one is concluded.

It was designed to preserve orderliness, efficiency, and moderation while maintaining healthy competition. There is no limit to the number of pools a user can operate or contribute to, as much as their balances are sufficient to cover the operating cost. No user can operate a pool with a duration above 30 days. Also, setting interest rates is optional.

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<summary>What Is Unit Liquidity?</summary>

An amount provided by a contributor as liquidity or contribution to a pool.

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<summary>What Is Quorum</summary>

The maximum number of users that can contribute to a pool. Usually, it is set by the operator. Quorum is a required parameter to launch a new Pool. If the type selected by the operator is **`permissioned`**,  the quorum is the length of the list of participating addresses supplied by the operator. Generally, the minimum number of participants in a pool is 2 while the maximum is 255.

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<summary>What Is An Epoch/Cycle?</summary>

An Epoch otherwise known as a Cycle is the total period/time it took all the contributors of a pool to benefit from the pooled liquidity. It may however be perceived as the total period it took all the contributors to fulfil their turn. Example: Assume a FlexPool with a 3-hour duration, and the quorum is 3, the cycle or epoch will be 9 hours since this will be the aggregate time it will take all the participants to benefit from the system.

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<summary>What Is Duration?</summary>

The length of period a loan is due for repayment. This period is often short and is specified in hours between 1 and 720 hours. While 'Duration' is set for an epoch, a contributor may specify their choices when it's their turn to get finance. The user's choices are prioritized over the operator's. If the user's choice is not set, the contract falls back to the pool's. However, the following conditions apply. &#x20;

* The contributor's choice must not exceed that of the pool.
* Maximum duration is tentatively pegged to 30 i.e. 720 hrs.

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<summary>How To Get Finance?</summary>

Getting finance is treated on a first-in-first-out (FIFO) basis. When a user contributes to a pool, they're progressively assigned a unique slot. An operator/creator of a pool will often take the first slot but may not be the first to get finance due to circumstances such as failure to show up when due. As a contributor, when it is your turn to get finance, you're expected to interact with the contract (often with 1hr grace period) otherwise another contributor may claim your slot. You may also follow the steps mentioned [**here**](https://simplifinance.gitbook.io/docs/getting-started/quickstart-2).

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<summary>How Do I Know Its My Turn?</summary>

Each contributor is assigned a unique value as they join the pool. When the quorum is achieved i.e. when the expected number of contributors is completed, the time for the first on the list starts immediately. The type of button displayed to you is an indicator of what to do next. If you're the next to get finance, the call-to-action button will display <mark style="color:orange;">**'GET FINANCE'**</mark> .

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<summary>How Do I Withdraw?</summary>

Withdrawal is activated when a contributor sends a valid get finance request to a pool they contributed to.  However, a few conditions must be met before the transaction can pass.&#x20;

* The users must have enough native coins (such as XFI) in their wallet to provide cover for the given loan based on the operating collateral index.&#x20;
* The contributor must give enough approval as a spending cap.

The Payback period is another instance where withdrawal is activated. This time, the contributor pays back their loans thereafter the collateral is unlocked. To withdraw collateral or liquidity balance, click on<mark style="color:orange;">**`MORE INFO`**</mark>.

<img src="https://1789873725-files.gitbook.io/~/files/v0/b/gitbook-x-prod.appspot.com/o/spaces%2FybCOfRIR708fPlebwyA4%2Fuploads%2FWzx0s2EVan63XEnVEFhx%2Fmoreinfo.PNG?alt=media&#x26;token=86fa7062-2125-48c2-b293-810cfdf2f4c4" alt="more info" data-size="original">

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<summary>What Is Liquidation?</summary>

Liquidation is possible when a contributor defaults in meeting up with the payback deadline. When a contributor fails to replenish the pool at the due date, they can be liquidated by any user of the protocol that is not a contributor to the pool. For liquidators, It could be profitable or otherwise since they bear the burdens of repaying the full loan. The full collateral value is also released to the liquidator.

Liquidation may cause participants in a permissioned pool to forfeit earnings or a part of their liquidity. Losses and profits are spread evenly among the participants where interest is set

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<summary>What Is Collateral ratio/Multiplier                                                                                                   </summary>

collateral neededCollateral factor/coverage is usually determined by the operator of the pool at the time of creation. This is the percentage of loan secured by discounting the value of XFI.&#x20;

If a pool has 100 USDT as loa n base while the collateral factor is 150. If the price of XFI at the borrow point is '$0.5 USDT' the required collateral in XFI will be calculated as **collateralNeeded = ((100/0.5) \* 150) / 100**

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