SaFi Bank Space : Collections requirements for Loans

For both Overdraft and Personal loan product, we will define the user requirements and business expectation for collection processes.

A loan product will be considered in collection, the moment the customer becomes delinquent, by not repaying the expected due amounts or its product.

App screen designs

updates needed for delayed Personal Loans:

1. update loan product screen to reflect that overdraft cannot be taken anymore, once PL is in delay/overdue

2. update loan product screen to reflect that a PL is in delay/overdue

3. update PL overview w/ a warning box about the delinquency

4. update PL overview w/ Topup account button instead of Repay

5. update PL overview to show delayed debt, in red

6. Transaction history:  create some mockups to see what happens (as partial collection of the missed instalment is possible too). For the transaction history of a delayed Personal loan, we need to consider 2 scenarios

   1. At due date customer has 0 funds on his main account -> full monthly payment goes into delay

   2. after a few days, customer will repay fully the delayed/late amount -> ? not sure how it will be displayed

   3. OR after a few days, customer will repay partially the delayed/late amount -> ? not sure how it will be displayed

   4. At due date customer can partially repay the monthly payment for the personal loan -> only the remaining goes in delay, and the repaid part is shown as green in TX history

7. Transaction history: display the late fee amount and date, the moment is applied to the loan account. Will there be a descirption of the late fee?.

Collection tool - Loxon

https://documenter.getpostman.com/view/18136436/UVC2G8wt

Collection agents using the collection tool should be able to:

• Insert information about the customer

• Modify contact information (like phone number, email address)

• Create a new loan contract, with predefined parameters such as: loan amount, loan term, interest rate (2nd phase - part of the restructuring below)

• Restructure the repayment plan (2nd phase)

• Waive fees/interest that will not cause a recalculation (part or whole) - phase 1 (check for phase 2 - part of the principal). Fees and interest can be waived when in the ledger (overdue amounts or paid amounts).

• Trigger (manually or as setup by SaFi) the late fee payment in case of overdue amounts.

++Add Architecture

Reminders (Loxon tool, Safi to provide interfaces):

The collection tool will be triggering reminders for loan products, based on the predefined schedules:

• x days before instalment due date

• notification about not paying the due instalment

• notifications/reminders about overdue amount

The reminders will be configured either as a push, email, sms message, automated calls, letters, calls.

The exact calendar of notifications/reminders and ways of sending

1. Will be handled by Loxon

2. Initial version of strategies: Collections - High amount, Low risk

3. On personal loan level, we will need to consider the additional messages sent to the delinquent customers, for sales purposes.

Product information screen (Loxon tool):

The collection tool will enable agent to see information about the client repayment history

• Visualize the Repayment plan: past repayments and their status, future repayments. Each repayment should show the detailed structured split between

  • interest, principal,

  • due and overdue amount,

  • penalty amounts

• In case of overdue products, the tool should display DPD count per product.

Also, on client level, the collection agent should be able to see the client notification history.

All collection related processes will be triggered by Loxon collection tool, including write-off.

Product information

The updates won loan account side and client updates, we will be sent to Loxon, for all the events that cause changes on product or client information level:

• Loan account opening

• Instalment plan creation

• Delinquency flag

• Instalment plan updates

• Pre-payments

• Loan closure

• Client information updates

The updates will be done in real time via Kafka streams.

The minimum required information we need to share with the collection tool will be defined as per the API documentation. Jan Görig (Unlicensed)

Loan statuses to considered are defined on Collections Account Status Flags

BO requirement is that, in case of any loan restructuring changes, TM should be receive information from collection tool, Loxon, and then accept and return the new parameters.

Open questions