Every month, for the clients with an active personal loan and/or an active overdraft (not yet repaid), the system will automatically deduct the payments needed for the loans, from the predefined accounts.
Once a reimbursement (payment) that was due and was not covered, it will become a debt and will be considered overdue. These accounts of the loan product can be marked as delinquent.
At due date, we need to automatically look for the funds and cover the due amounts:
instalment : principal and interest
or overdraft amount
This repayment should be done immediately on the due date, when the money are available on the account. The repayment can be done in multiple tranches during the day, based on the money availability.
If the repayment was not processed in full amount, then the remaining unpaid amount (after the due date) will become overdue and moved to specific overdue addresses. A late fee may be applied in case of overdue debts on loan accounts. In such cases, we will need to immediately move the funds that become available on main account or unlocked pockets, at any time during the day, and cover the overdue debts in the predefined order.
Unpaid debts will be allocated per product and per time of posting, in the following order
Personal loan
Oldest unpaid instalment to most recent unpaid instalment
covering in the order setup below
Overdraft, only after the higher priority product will be fully covered
in the order setup below
In case of late fees, the implementation was decided to be done:
MVP phase: we will cover fully all the late fees raised on customer side (one bucket- simple implementation)
Public Launch or later: the late fees will be posted/connected to the instalment plan and therefore, allocated in the order from oldest to newest, connected to the instalments.
Types of Personal Loan debts |
|---|
Loan opening fee |
Late fees charges for overdue personal loan amount |
Overdue Interest belonging to unpaid instalments |
Overdue Principal belonging to unpaid instalments |
Due interest |
Due principal |
Overdraft | Personal Loan | |
|---|---|---|
Transactions allowed from loan amount | Debts that are allowed to be repaid from this amount:
| Any |
Restrictions - transactions restricted from the loan amount |
| No restrictions |
Reimbursement of debts | Possible from:
| Possible from:
|
*in case of multiple unlocked pockets, use the one that has enough money to cover the debt, without closing the pocket. In case that is not possible, use all the money needed without closing the pocket, even if the remaining balance is 0. CLOSED
**For locked pockets: remove as much money as needed to reimburse the debts. Keep the remaining pocket money (if any) unlocked. CLOSED
out of scope: Please decide if there is any notification needed to be sent by the collection tool in the case we use money from pockets (locked or unlocked) CLOSED
All funds available should be used for debt allocation, including interest.
CLOSED
First, check main account for auto-deduction on due date
At midnight, if more funds are needed we check:
unlocked pocket/s: collect interest accrued and then funds available in the pocket
If more funds are needed to cover debts, then collect from locked pockets.
Lukas Civin User 893ea please consider the time for instalment and debt collection from the accounts.
Open questions:
FINAL LIST OF FEES - OPEN what is the list of the final debt types that we should record? we have this list: Collections with priorities, but from what I understood until now, it is not final - estimated to receive from Safi during first week of October.
which debt types are repayable from overdraft and which not? for dev purposes I will assume that only “main account subscription fee” and “loan penalty” are repayable from overdraft - Veronika Žatková (Unlicensed) based on input from Dhan, only main account subscription fee. CLOSED
what are the requirements for frontend in case of debts? what should be frontend able to display in app, when someone is in debt? total amount and types of debts / amounts? is this somewhere written / are the requirements on this collected already from client? - Yes, we show the debt in the Personal loan or overdraft product informaiton screen. Veronika Žatková (Unlicensed) 1. Overdue Loan Products - product behavior
is it possible to be already in debt and still open a new overdraft / pocket account? - Overdraft no. If in debt, we should automatically keep the money available for the pocket creation, so the client should be able to open a pocket with the remaining balance only. Veronika Žatková (Unlicensed) 1. Overdue Loan Products - product behavior
