Setting up payment tolerance

Payment Tolerance is the permissible amount of tolerance provided by a financial institution to clear the bills. Borrowers may request for specific periods of payment tolerance in their contracts.  The default payment tolerance rate is specified at the org level. However, you can modify it at the product and contract level. 

You can define the payment tolerance as a rate or a fixed amount. In addition, you can define it as the minimum or maximum of these two values by selecting the Payment Tolerance Type as Min or Max. 

For example,

Tolerance = MIN (10% or 50). If bill amount = 400, tolerance is 40 (minimum of 40 and 50). 

If bill amount = 600, tolerance becomes minimum of (60 and 50) = 50.

For information about the impact of payment tolerance on the contract, how it is applied, and steps to modify its value, refer to section Payment Tolerance in the CL Loan User Guide. 

Prerequisites

None.

Steps

Perform the following steps to set the default tolerance rate at the org level:

1. Login to your Salesforce account.

2. Click your Username.

3. Click Setup.

4. Go to App Setup, Develop.

5. Select Custom Settings.

6. Go to Org Parameters and click Manage.

7. Click Edit. 

8. Specify the Default Tolerance Rate.

   This is the organization wide tolerance value for loan repayments. 

9. Click Save, the default tolerance rate is set.

Perform the following steps to set up or modify the payment tolerance in the lending product:

1. In the lending product you are creating or modifying, scroll to the Grace and Tolerance section. 

2. Define the payment tolerance details:

   1. Select the Payment Tolerance Type. The options available are Null, Min and Max.

   2. Specify the Payment Tolerance Rate. If you have specified the tolerance type as Min or Max, this field is mandatory. 

   3. Specify the Payment Tolerance Fixed Amount. If you have specified the tolerance type as Min or Max, this field is mandatory.

3. Click Save.