At the time of handover, the disclosure statement requirements has not been finalised and it was not included in the handover package.
Below are the initial business requirements, that have been updated but not yet approved for work. <24-november-2022 status>
The Personal loan disclosure statement is an in-app screen that needs to be displayed in the app for customers to see the actual computation of the loan after the loan has been disbursed to the customer’s main account.
This said disclosure statement is in compliance to PH regulation mainly, Truth in Lending Act. The said statement should display the following information:
Column / Segment Name | Information / Field Name | Description | Formula / Computation |
|---|---|---|---|
Borrower’s Loan Information | Borrower’s Name | Customer’s Registered Full Name | |
Borrower’s Address | Customer’s Registered Address | ||
Principal Amount | Total Loan Amount | Approved Loan amount | |
Total # of Installments | Approved Loan Tenor | ||
Other Bank Charges | Total Other Bank Charges | Total amount of other bank Charges | Processing Fee + DST |
One - Time Processing Fee | One-time charge to the customer for processing the loan that is deducted upon disbursement of the loan | A fixed % that should be define in the Product Recommendation Tool | |
Documentary Stamp Tax (DST) | is a tax on documents, instruments, loan agreements and papers evidencing the acceptance, assignment, sale or transfer of an obligation, right or property incident thereto | Since we are not sending a physical paper of the loan agreement, this should always be '0' but we still need to show this for future proofing and use case as we expand personal loan product. | |
Net Proceeds | Disbursed Amount | Net disbursed amount | Principal Amount - Other Bank Charges |
Interest | Monthly Interest | Bank’s published monthly interest rate '%' for personal loan | a fixed % that should be displayed and is defined in the Product Recommendation tool |
Effective Monthly Interest | Loan’s Effective monthly interest rate '%' for personal loan computation of the internal rate of return for a series of cash flows, assuming equal-size payment periods | IRR of all the installment amount for the duration of the loan | |
Effective Annual Interest | Loan’s Effective Annual interest rate '%' for personal loan computation of the internal rate of return for a series of cash flows, assuming equal-size payment periods | 1 + IRR of all the installment amount for the duration of the loan x 12 - 1 | |
Other Charges | Late Payment Penalty | Fixed penalty charge to customer for late payments per calendar month | Defined by Collections Team (can be a fixed amount or a % if any unpaid installment) |
Early Repayment Fee | Fee charge to customer for early termination of the loan | Defined by Collections Team (can be a fixed amount or a % if any unpaid installment) |
Effective Annual Interest Rate is only applicable for loans with at least 12 months installment
Below is a sample screenshot which we can refer on how we want to display the Disclosure Statement:
