Migrated over from MifosForge – final edit on September 15, 2015.
- This particular feature permits a individual to
Background and strategic fit
This is especially valid of items like agricultural loans where consumers money moves can be very volatile. Consequently returns such sectors are regular, unpredictable and frequently less than those of this regular commercial enterprises for which MFIs disburse loans. This necessitates the necessity for finance institutions to personalize loans products, which provide for more freedom because of the installment routine.
The adjustable Installment Loans function of Mifos X accommodates this flexibility by indicating:
For a financial loan item:
Minimal and maximum gap that should always be current between installments (minimum is mandatory, nevertheless optimum is optional)
An optional minimum installment quantity
Allow installment due times to be modified
Allow installment amounts to be modified total that is(either or major part may be cash-central.com modified)
Include installments that are additional
Validate the routine and calculations after making these modifications
Adjustable Installment could be specified for loans which have either flat interest calculation or diminishing balance based interest calculation
For the offered loan routine, individual may either alter principal or installment quantity (rather than both)
User will make these adjustments just just before loan account approval.
Consumer may change the date of all installments.
Consumer might not alter the quantities for the final installment.
Then the other will be automatically calculated by Mifos if the user enters an amount for either principal or installment amount.
An individual may specify installments that are variable 3 situations:
1) Flat Interest Rate
2) Interest according to Diminishing Balance
3) Interest according to Diminishing Balance with Interest Recalculation
Situation 1: Flat Interest speed: Mifos will likely not recompute interest for every installment. Additionally the total interest will stay exactly like it had been once the initial routine had been created.
Consumer alters times: Date can’t be before past installment date or following the installment date that is next. The brand new date is accepted. No other change.
Consumer alters amount that is principal This quantity may be zero. The quantity is accepted. The installment quantity is determined by Mifos as “Installment Interest” + the amount that is principal. The huge difference in quantity (between newly specified principal and principal that is original the installment) will likely be similarly distributed among other installments principal which were not modified.
Consumer alters installment amount: Amount could be zero too. In the event that quantity specified is higher than the attention, then your principal amount is calculated by Mifos as installment amount specified without the “Installment Interest”. Then the interest is set to this value if the amount specified is less than the interest amount for the installment. The real difference in major quantity or interest quantity (between newly specified quantity and amount that is original the installment for both interest and principal) are going to be similarly distributed among other installments (principal and interest) that have been perhaps maybe not modified.
Situation 2 and 3: Interest predicated on Diminishing balance (without or with interest recalculation)
User modifies dates: Date is not before past installment date or following the next installment date. The brand new date is accepted. The attention from the installments that follow the modified installment shall be recalculated predicated on major outstanding and quantity of times of each installment.
Consumer modifies major quantity: This quantity may be zero. The total amount is accepted. The huge difference in major amount (between newly specified quantity and amount that is original the installment) is supposed to be similarly distributed among other installments’ principals which were not modified. The interest in the installments that follow the modified installment is supposed to be recalculated predicated on major outstanding and amount of times of each installment.
Consumer alters installment amount: Amount may be zero too. Then the principal amount is calculated by Mifos as installment amount specified minus the “Installment Interest” if the amount specified is greater than the interest,. Then the interest is set to this value and the difference in interest is either added to the next installment (if compounding is turned off) or added to principal if compounded is turned on for this loan product if the amount specified is less than the interest amount for the installment. The attention in the installments that follow the modified installment will be recalculated predicated on major outstanding and quantity of times of each installment.
The attention recalculation is going to be on the basis of the configuration that is relevant of loan item as specified at: adjustable Installment Loans
For Loan Products
|Can configure variable installments||Flag denoting whether this loan product help adjustable installments||real or False. Blank w. Ould suggest False.|
|Minimal space between installments||Integer value that denotes the minimal quantity of times that must be current between any two installments because of this loan item.|
|Maximum space between installments||Integer value that denotes the utmost wide range of times that should be current between any two installments because of this loan item.|
|Minimal installment quantity||Integer value that denotes the minimum installment quantity.|