Editing and Customizing Repayment Schedules

Once a loan approved and disbursed, you can check the repayment schedule built based on the contract's details in the Payments tab. You can also view the versions of the repayment schedules automatically generated by Core Banking when the schedule is recalculated due to specific contract events.

If you need to have a schedule to reflect a product that has a fixed rate for the first x years and moving to variable afterward, use a Collection interest type at product definition. When creating the contract, Core Banking automatically builds the schedule projection with the 2 different rates, while the changes in amounts to be collected are visible upfront. This is sometimes referred to as fixed to variable loan, especially valid for mortgages. Read more in the Manage Contract Level Interest & Penalty Interest Rate and in the Applying Fees and Commissions sections.

When you need to collect amounts during the life of the loan, but also leave a balloon (residual) payment, you can use the functionality enabled via the Is Manual Value option on the contract, if Installment Value Custom is set on the schedule type definition used within the product. This allows you to overwrite the repayment amount in the Initial Royalty or Initial Principal Value field and provide a lower one, thus any capital not made due until maturity results in a balloon payment. In practice, you can also manage in this way fixed to variable loans where the business is to fix the mortgage for the x years, and you are expected either to close by the time it moves to variable, or re-fix again. Read more about setting the repayment information on contract level in the Enter Repayment Information for the Contract section.

A revolving line of credit might be a case where you need to enable a loan for which you collect interest and potentially some fees monthly, at end of month, and the principal at maturity. Such loan would also be a revolving one. This sort of setup can be achieved with a schedule definition that includes the fee. On the contract, you select the due date as end of month, plus a grace for principal for the number of installments of the full loan minus one, for example the loan has 13 installments, the Principal Grace Period (Months) has 12 installments, and thus all principal is expected to be repaid on maturity. When the funds are available, you can perform an early repayment transaction and reuse those funds again when needed since it is a revolving setup. In practice, such approvals may be extended and if this is the case you need to make sure you perform the extension one day in advance of the maturity, otherwise the jobs set at the end of the day also pick up and process such maturity. Read more about setting the repayment information on contract level in the Enter Repayment Information for the Contract section.

Below is an example of an out-of-the-box setting for a repayment schedule setup, to obtain the same approach with full capital repaid on maturity. Make sure you have Once for Principal definition, as pictured here:

Apart from the standardized regular repayment schedules, there may be cases when for a specific customer or for a specific business area you need custom repayment frequencies or even amounts. For such cases, you can manually upload a repayment schedule from an excel template. There are some validations and transformation requirements, but at the end you have a repayment schedule that does not follow any of the classical definitions.