Billing methods

You can use any of the following billing methods to generate bills for LOC contracts. The billing method can be selected at the product or the contract level. You can use same or different billing methods for the Draw Term and the Repayment Term:

• Interest Only

• Percentage Of Remaining Balance

• Principal plus Interest

• Percentage Of Credit Limit

• Bill Amount as percentage Of Credit Limit

• Sliding Billing Method

Billing concepts

Minimum bill amount 

The bills are generated on run time based on the minimum bill amount specified for the contract. Based on the billing method selected, if the derived due amount is less than the minimum bill amount, the bill is still generated for the latter. However, if the minimum bill amount is more than the total due on the contract, then the total due amount takes precedence. 

Bills with zero amount

There may be scenarios when full payment is made by the borrower and/or no further disbursals are made. As a result, the future bills are created for zero amount and no payment is required from the borrower till the next disbursal happens. These contracts are not picked up by the delinquency processing job. Instead, such bills are marked as satisfied and the oldest unpaid due date is updated to the next installment date in the Billing handler. For example, disbursed amount = 1000, repayable in 10 bills of 100 each. No further withdrawals are made by the borrower. Then, even if the borrower does not pay any of the bills, the 11th bill is generated for 0 amount. Delinquency is handled by the system by marking the contract as Active-Bad Standing and levying late payment charges, if these are set up on the contract.