Question:

How would I set up a loan account with interest accruing at a specific set rate. The loan is from a private individual.

Answer:

The software will not do the calculation automatically for you. You will have to do a journal entry every month to show the interest that has been charged.

Create the accounts in Chart Of Accounts.
Call one - "Loan Account - The Individual's Name." Create this account as a Liability account - Non-Current Liabilities.
Call the other account - "Interest charged on Loan Account." or something similar. This is created as an Expense account.

When you see the Loan in the Cashbook - allocate it to "Loan Account - The Individual's Name."
When you see payments to the individual - allocate it to "Loan Account - The Individual's Name."

On a monthly basis, you will have to add the interest charged as a Journal entry.

Select JOURNALS/CLASSIC JOURNALS. On the Debit side, select the "Interest charged on Loan Account" account. On the Credit side, select the "Loan Account - The Individual's Name."
Description will be "Interest charged for the month of ...." Date chosen will be the end of that month's date. Amount will be the amount charged. You then Process the transaction.

The transactions can be viewed and analysed in the General Ledger and on the Complete Financials.