Menu / Loan Servicing / Loan Activity / Charges Templates

Charges Templates

The Charge Templates page allows you to add, update or delete the charges that will apply to each client.

You can also set up how the charge should be applied, for example, add to the loan balance, accrue and post once per month to the loan balance or accrue and issue a charges statement.

Note, as a pre-requisite, the charge codes need to be first set up under Menu → ABL → Other General Codes →  Charge Codes.

Navigation: Menu → Loan Servicing → Loan Activity → Charges Templates

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Fields and Descriptions

Create Charge Code

To create a new charge code, perform these steps:

1. In the Loan ID field, select the loan ID from the drop-down list.

2. Click the  button.

3. In the Charge Code field, select the charge code type from the drop-down list.

Once you select the charge code, the system auto-populates the values in Nat Sign, Sequence, Frequency, Charge Type, Value, Posting Type and Source Type fields for the respective charge code as defined in the Charge Codes page for both ABL and MCL loans. You can also modify the field values if required.

4. In the Nat Sign, Sequence, Frequency, and Charge Type fields, provide the required values.

5. In the Collateral Name field, select the collateral name from the drop-down list.

6. In the Value field, enter the value.

7. In the Posting Type field, select the posting type from the drop-down list.

8. In the Source Type field, select the source type from the drop-down list.

1. If the Posting type is selected as In Balance, then the system would display the source types such as ADVANCE, COLLECTION, FEES/CHARGES and INTEREST.
2. If the Posting type is selected as Accrue to Loan or Accrue to Statement, then the system would display only the source types such as FEES/CHARGES and INTEREST.

9. Click the  button. The charge template is created and saved.

 Once the charge code is applied in Collateral Loans, NAT Sign, Source Type, and Posting Type of the applied Charge code cannot be edited.
The system does not allow editing NAT Sign, Source Type, and Posting Type of that Charge code on the Charges Templates page.

Upon creating new charge codes, the system logged the charge code creation details on the Audit Log page.

If the posting type of custom INTEREST charge code is not same as the posting type of standard INTEREST charge code while creating/editing the charge code in Charge Templates page, then the system shows an error notification.

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The posting type of standard INTEREST charge code can be set under Charge Codes page.

If user tries to change and save the Nat sign of the Charge Code which was already associated with the Cash Receipts Source Code, then the system shows an error notification.

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Edit Charge Code

To edit a charge code:

1. In the Loan ID field, select the loan ID from the drop-down list.

2. Double-click on the charge code field you want to edit.

3. Change the value of the charge code or enter a value.

4. Click the  button. The charge template is updated and a success message "Charge Template was successfully updated" appears.

Upon editing the existing charge codes, the system logged the charge code editing details on the Audit Logs page.

Delete Charge Code

To delete a charge code, perform these steps:

1. In the Loan ID field, select the loan ID from the drop-down list.

2. Select the row of charge code that you wish to delete.

3. Click the  icon. A Delete pop-up window appears.

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4. Click the  button. The charge template is deleted and a success message “Charge Template was successfully deleted” appears.

The charge cannot be deleted if it has already been used in  Collateral Loans. Upon deleting the existing charge codes, the system logged the charge code deletion details on the Audit Logs page.

Accrue to Loan - Once the repayment is made and the closing balance is reduced to zero, then float interest is calculated based on the defined float days.

Once the excess payment is made and the closing balance appears negative, then float interest is calculated based on the outstanding balance of the repayment date and based on defined float days.

Charge Types

Charge types include the following:

For example, Consider the Charge Code as Legal Fee, Charge Type: Gross, Collateral Name: Receivables 1 (Gross Receivables: $100,000.00) and Value: 0.100000 (this is considered as a percentage), then the Legal fee is calculated as $100,000.00 * 0.100000% = $100.00.

1. Value: If the selected charge type is Value, then the fees are calculated based on the value rate.

2. Loan: If the selected charge type is Loan, then the fees are calculated based on the outstanding loan value.

3. Loan / Float: If the selected charge type is Loan / Float, then the interest is calculated based on the total of interest applied to the outstanding loan value and the float amount.

• Posting Type = Inbalance: If the charge code selected is Loan / Float, the posting type is inbalance, and the user makes a manual repayment or processes the repayment through the Cash Application, the following occurs:
  • If float days are specified for this transaction, the Interest is the sum of  Loan Interest and Float Interest and posted on Day 1. The interest amounts are added to the closing balance.
• The Interest Calendar allows users to define business and non-business days, impacting the calculation of float days.
  •  Example:
    • A repayment made on Friday with a float period of 3 days will result in:
      • 5 float days if Saturday and Sunday are defined as non-business days.
      • 3 float days if Saturday and Sunday are defined as business days.
• Float interest is calculated on a daily basis based on the number of float days defined.
• Formulas: 
  • Normal Interest:
• (Closing Balance × Interest Rate) ÷ Daily Divisor
  • Float Interest:
• (Repayment Amount × Interest Rate) ÷ Daily Divisor
  • Total Interest:
• Normal Interest + Float Interest

4. Loan / Float / Advance: If the selected charge type is Loan / Float / Advance, then the interest is calculated based on the loan amount, float amount and advance rate. 

• Unused Line: If the selected charge type is Unused line, then the fees are calculated based on the unused line.
• If any charge code is set with Un-Used Line as Charge Type, then the fee is calculated based on the individual Credit Line amount of each Loan ID. The Unused Line Fee is calculated for ABL and Non-ABL loans as follows,
• Fee Charged = (Individual Credit Line – Max (Minimum Balance, Average Loan Balance)) * value specified.
• If the Statement Balance Before Loan Balance flag is OFF under the Basic Parameters page and the Minimum Balance Amount is 0.00 under the Basic Client Detail page, then the Unused Line Fee is calculated as follows,
• Fee Charged = (Credit Line – Average Loan Balance (Average of Closing Balance based on the frequency set)) * value specified.
• If the Statement Balance Before Loan Balance flag is ON under the Basic Parameters page and the Minimum Balance Amount is 0.00 under the Basic Client Detail page, then the Unused Line Fee is calculated as follows,
• Fee Charged = (Credit Line – Average Loan Balance (Principal Balance of a particular Loan ID based on the frequency set)) * value specified.
• If any closing balance is missing for any dates within the frequency set, then the system would consider the closing balance of the previous day but not as “0.00” even when the Unused Line fee is set along with INTEREST.

5. Minimum Balance: If the selected charge type is Minimum balance, then the fees are calculated based on the balance.

6. Original Amount: If the selected charge type is Original amount, then the fees are calculated based on the original amount.

7. Gross: If the selected charge type is Gross, then the fees are calculated based on the gross value.

8. Eligible: If the selected charge type is Eligible, then the fees are calculated based on the eligible amount.

9. Available: If the selected charge type is Available, then the fees are calculated based on the available amount.

10. Borrowing Base: If the selected charge type is Borrowing Base, then the fees are calculated based on the borrowing base value.

11. Net Available for Advance: If the selected charge type is Net Available for Advance, then the fees are calculated based on the net available for advance value.

12. Loan vs Net Avail Advance: If the selected charge type is Loan vs Net Avail Advance, then the particular charge code amount will be calculated based on the condition IF(Closing Balance - Net Total Available for Advance > 0, TRUE Net Total Available for Advance, FALSE Closing Balance) * Value.

'Loan Balance is Positive' condition can be applied for the latest approved BBC. For this condition, the Net Available for Advance is calculated by considering the Net Total Available for Advance value as given in the BBC Availability page.

Loan – (Loan vs Net Avail Advance): If the selected charge type is Loan – (Loan vs Net Avail Advance), then the particular charge code amount will be calculated based on the condition (Closing Balance - IF(Closing Balance - Net Total Available for Advance > 0, TRUE Net Total Available for Advance, FALSE Closing Balance)) * Value. 

'Loan Balance is Negative or Zero' condition is applied for the latest approved BBC. For this condition, the Net Available for Advance is calculated by considering the Net Total Available for Advance value as given in the BBC Availability page.

Also, the system calculates the charge amount in the collateral loans based on the following scenarios:

Scenario 1: Loan Balance is Positive (No Approved BBC or Net Available for Advance = 0 for last approved BBC)

For example,

Closing Balance = 50000

Value = 0.000156862750 for Loan vs Net Avail Adv

Value = 0.000266666670 for Loan - (Loan vs Net Avail Adv)

Closing-Net Available > 0 (50000 - 0 = 50000)

Loan vs Net Avail for Adv = Net Available for Adv * Value (0 x 0.000156862750) = 0

Charge Amount = 0

Closing-Net Available > 0 (50000 - 0 = 50000)

Loan-Loan vs Net Available for Adv = (Closing Bal- Net Available for Adv) * Value = 50000 * 0.000266666670 = 13.3333335

Charge Amount =13.3333335

Scenario 2: Loan Balance is Negative or Zero (No Approved BBC or Net Available for Advance = 0 for last approved BBC)

Closing-Net Available < 0

Loan-Loan vs Net Available for Adv = (Closing Bal- Closing Bal) * Value

Closing Balance = -1000

Closing-Net Available < 0

Loan vs Net Available for Adv = Closing Balance * Value =  (-1000* 0.000156862750)= -0.1568627

Charge Amount = -0.1568627

Closing-Net Available < 0

Loan-Loan vs Net Available for Adv = (Closing Balance - Closing Balance ) * Value (-1000 - -1000 ) = 0 * 0.000266666670 = 0 

Charge Amount =0

The charge amount will not be displayed in the collateral loans if the charge amount is either 0 or negative.

15. New Sales: If the selected charge type is New Sales, then the system fetches the data from the last approved BBC. The charge is calculated based on the New Sales value available under the BBC Availability page.

16. Disbursement: If the selected charge type is Disbursement, then the particular charge code amount is calculated based on the Disbursement amount.
For example, Consider Charge type as Disbursement for WIRE FEE.
Value = 0.02 (This is considerable a percentage)
Disbursement Amount = 5000
WIRE FEE = Disbursement Amount * Value (5000 * 0.02) = 100.

The Disbursement option is disabled if the charge codes are selected as Disbursement, Repayment, Interest, Unused Line Fee, and Minimum Loan Balance Charge codes.

If a user edits the fee once the BBC is approved, then the fee amount is updated based on the latest disbursement amount only after approval of the next BBC. The updated fee details are displayed on the Collateral Loan page, BBC Availability page, BBC Trend Report page, and Collateral Analysis - Comparative Report page.

17. Credit Line: If the selected charge type is Credit Line, then the particular charge code amount is calculated based on the Credit Line amount entered on the “Basic Client Detail” page.

For example, Consider Charge type as Credit Line for ADMINISTRATION FEE.
Value = 0.02 (This is considerable as percentage)
Credit Line = 1500000
ADMINISTRATION FEE = Credit Line * Value (1500000*0.02) = 30000.

The credit line is disabled if the charge codes are selected as Disbursement, Repayment, Interest, Unused Line Fee, and the Minimum Loan Balance Charge codes.

If there is no credit line set under the Basic Client Details page, then the fee should be displayed as 0 on the, Collateral Loans Page.

If a user edits the credit line amount once the BBC is approved, then the fee amount is updated based on the latest credit line amount only after approving the next BBC. The updated fee details are displayed on the Collateral Loan page, BBC Availability page, BBC Trend Report page and Collateral Analysis - Comparative Report page.

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If the Charge Types selected are Gross/Eligible/Available/Borrowing Base/Net Available for Advance and based on the selected collateral type, the rate available under the Value column is always considered to be %.

Source Type

Source Type - Advance 
 

For all the charge codes with the Advance source type, the frequency and posting type are set to Manual and In Balance, respectively. These are non-editable fields.

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On editing the Disbursement charge code, the Frequency field is not an editable field like Sequence or Charge Type.
When editing any of the charge codes with the Advance source type, the Frequency and Posting type fields are non-editable.

There is no impact on Disbursement or Funding, which is done through Analyst Workflow or BBC Status Page or Through Collateral Loan Upload.

Source Type - Collection

The Frequency and Posting Type for all the Charge codes with Collection Source Type are set to default Manual and In balance respectively. These are non-editable fields.

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When editing the QA Custom Repayment Charge Code, Frequency and Posting Type fields are not editable field like Sequence, Charge Type.

When editing any of the charge codes with the Advance source type, the Frequency, and Posting Type fields are non-editable.

There is no impact on repayments done through a Cash Application or through Collateral Loan Upload.

Late Fee

The option allows to specify late fee and defines the invoice frequency. The late fee is applied based on the selected invoice frequency, It includes Monthly, Quarterly, and Annually. You may add the late fee amount or late fee (%).

To add the Late fee, perform these steps:

1. Click Late Fee option, A Late Fee Details popup appears.

2. In the Invoice Frequency drop-down, select the frequency.

3. In the Past Due Days text box, enter the due days.

4. Select the Late fee as % ? to enter the late fee as percentage (%) or clear it to add the Late fee amount.

5. In Late Fee % field, enter the late fee percentage value.

6. Click the  button to save the date or the  button to cancel the action.

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