Can someone ELI5 on how binance perpetual contract works?

I've went through perpetual guide on bitmex but could not understand they do.

Here (https://www.binance.vision/economics/what-are-perpetual-futures-contracts), binance has a nice explanation of what perpetual futures contracts are. But I'm still confused, especially this part:

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The funding rate is based on two components: the interest rate and the premium. On Binance futures market, the interest rate is fixed at 0.03%, and the premium varies according to the price difference between futures and spot markets. Binance takes no fees for funding rate transfers as they happen directly between users.

What is this interest rate? And it says the premium is the price diff between futures and spot markets. Is spot market the price of a coin(e.g. bitcoin) and futures price is the strike price of a contract?

How is the funding rate calculated? In Bitmex(https://www.bitmex.com/app/perpetualContractsGuide), it's calculated as

Interest Rate (I) = (Interest Quote Index - Interest Base Index) / Funding Interval Premium Index (P) = (Max(0, Impact Bid Price - Mark Price) - Max(0, Mark Price - Impact Ask Price)) / Spot Price + Fair Basis used in Mark Price Funding Rate (F) = Premium Index (P) + clamp(Interest Rate (I) - Premium Index (P), 0.05%, -0.05%)

Again, I don't understand all these terms...