Repayment modes constructor allows defining rules that regulate how the funds transferred by the customer are allocated among their payables.

There are three system-wide repayment modes available by default, but it is also possible to add some custom ones and define their settings for each credit product.

Adding a Custom Repayment Mode

To add a custom repayment mode to a credit product:

1. Go to the Settings → Loan Settings → Credit products and click the pencil icon by the credit product name

2. Open

   

   In the emerged window, open the “Repayment modes” tab and click the “Add repayment mode” button

   Open

   

Name and Descriptions

The mode name and description are displayed when selecting how the payment shall be allocated. It is important that other users and customers can understand what this mode is dedicated for

Availability

The mode availability defines if this mode can be available for Customers and/or Back-Office.

This means that when manually initiating a payment, they will see this mode in the selector.

Max payment amount

Define the maximum amount of the transfer that can be performed if this repayment mode has been selected.

Available options are:

• No limit

• Outstanding principal

• Sum of postponed fees

• Sum of special fees

• Payoff amount

Adding Steps

As it has been mentioned before, each repayment mode is a set of steps performed with the transferred amount.

The step are allocated in groups, subject to the installment they are related to:

We’ve strived to make the step names rather simple and easy to understand, however, should there be a doubt, select the step in the drop-down and its detailed description will appear below it.

If this is the step you need, click the “Add step” button, and the step will be added to the list

When there is more than one step in the list, you can use the up and down arrows to move the steps around the list.

The logic of the Mode Steps Performance

The system performs or attempts to perform repayment and recalculation steps in the order they are placed on the list. We can virtually divide the steps into:

• Repayment Steps: related directly to the usage of the transferred payment

• Recalculation Steps: related to recalculation of the loan fees, interest and principal in consideration of the previous repayment steps.

The system performs repayment steps in the order of their placement on the list until whole payment amount is used up, i.e.

1. If the amount is not enough to cover the step in full, it covers it in part and moves on to perform the remaining recalculation steps in the corresponding order. It does not perform any other repayment steps.

2. If the amount is enough to cover the steps in full, the system covers the step, and

   1. If the next step is a repayment step, the system tries to perform it (as in 1)

   2. If the next step is a recalculation step, the system performs it and moves on to the next step

The system continues, until the repayment amount is used up and all recalculation steps are performed.

Finalize the Repayment Mode Creation

Once you’ve defined all the steps and settings, click the OK button at the bottom.

When the Credit Product page emerges, click the OK button there as well to save the changes.