6. Finance costs


	2017 $m		2016 $m			2015 $m
Financial income
Interest income on deposits		1		3			2
Interest income on loans and receivables		3		3			3

		4		6			5

Financial expenses
Interest expense on borrowings		69		74			74
Finance charge payable under finance leases		20		20			20
Capitalised interest		—		(1	)		(2	)

		89		93			92

Interest income and expense relate to financial assets and liabilities held at amortised cost, calculated using the effective interest rate method.

Included within interest expense is $7m (2016: $3m, 2015: $2m) payable to the IHG Rewards Club loyalty programme relating to interest on the accumulated balance of cash received in advance of the redemption of points awarded.

The rate used for capitalisation of interest was 3.0% (2016: 3.8%, 2015: 3.4%).