Adam Saghy created FINERACT-2338:
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Summary: Allow backdated interest rate change on Progressive loans
Key: FINERACT-2338
URL: https://issues.apache.org/jira/browse/FINERACT-2338
Project: Apache Fineract
Issue Type: Improvement
Affects Versions: 1.12.1
Reporter: Adam Saghy
Assignee: Adam Saghy
Fix For: 1.13.0
h3. Goal
For Progressive loans we should allow backdated interest rate changes
h3. Requirement Details
# Interest rate can be modified from backdate any date from first disbursement
date
# Interest will be effected from the applied date itself.
# Backdate can be done on already paid Installments as well
# Repayment schedule will be recalculated with New EMI and Interest from the
Interest applied schedule date
## Backdated PAID Installments and Unpaid/Partial Paid Installment EMI would
be changed as per the new calculated EMI
# Installments paid Interest amount will be reverse replayed as per the new
Interest rate from the applied date
## Transactions will be reversed replayed if there is any change is allocations
## Accrual adjustments will done during reverse replay (during the COB process)
# No of Installments will remain the same, only EMI and Interest would get
affected
# Backdated Interest modification allowed on the loan that is charged off
-If the repayment that was made before the charge-off is reversed and replayed
due to backdated Interest modification,then the accounting entry of the
reversed transaction and replayed transaction should follow *standard
accounting rules and not charge-off accounting rules*
# Backdated interest modification allowed on the loan that is overpaid, and
CBR is complete.
-Fineract, any action that triggers the recalculation (ex: reversal of backdate
transaction) on the CBR loan will result in treating CBR as a credit
transaction during reverse-replay. Same logic to be applied if the backdated
interest modification is allowed on CBR loan accounts
# Asset transfer (externalization)
** If the repayment that was made before the asset owner change got reversed
and replayed due to backdated Interest modification,
Then, the accounting entry for the reversed transaction and replayed
transaction include the tag of the current asset owner
# Since backdated Interest modification is allowed on CBR/overpaid loans, we
can keep the modification open on closed loans as well
** system will do the chronological reverse-replay when the backdated Interest
is changed on closed loans, schedule and transaction will be allocated
accordingly
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