12. Maintaining Limits for Cross Currency Transac­tions

This chapter contains the following sections:

12.1 Specifying Limits for Cross Currency Transactions

Typically, the exchange rates applicable for cross currency funds transfer or teller transactions is defaulted by the system depending upon the preference indicated in the product preferences, for the product involving the transaction.

In your bank, for high-value cross currency transactions, you may want the user to manually enter the exchange rate involved, rather than let the system automatically pick up a default rate during transaction input.

You can define such a preference to be applicable to cross currency transactions involving:

The transaction amount limit, above which the exchange rate must be entered, for a high value transaction, could be defined in terms of currency pair where the currency of the transaction is currency1 in the CCY pair defined in the maintenance.

To ensure that users manually enter exchange rates for high-value cross currency transactions in Oracle FLEXCUBE, you must specify the limit amounts that must be validated for each transaction in terms of currency pair, product, module, and branch combination. You can use the ‘Product Limits Maintenance’ screen to specify the limits.

When you have specified these limits, the system automatically validates the amount with each transaction for the currency pair, product, module and branch combination, and accordingly, if the limits are exceeded, enforces the manual entry of exchange rates.

In case, the limit between ccy1 and ccy2 is given in ccy2, the system will automatically convert the transaction amount to an amount in ccy2 using standard mid rate and check against the limit amount whether or not manual entry of exchange rates is required. You can invoke the ‘Product Limits Maintenance’ screen, by typing ‘CSDPXMNT’ in the field at the top right corner of the Application tool bar and clicking the adjoining arrow button.

The screen appears as shown below:

Branch Code

You must specify the branch for which the limit amount will be applicable. You can specify that the limits must be applicable for all branches.

Module Code

You must specify the module for which the limit amount will be applicable. You can indicate that these limits must be applicable for both the Data Entry (DE) and Funds Transfer (FT) modules.

Product Code

You must specify the product, transactions involving which the limit amount will be applicable. You can specify that the limits must be applicable for all products.

Currency 1

You need to specify the currency1 applicable for defining the Transaction Amount limit, beyond which the system will not default the Auto Exchange Rate.

All valid currencies defined in the Currency Pair Maintenance will appear for selection. This currency is always the transaction currency of the contract.

Currency2

You need to specify the currency2 applicable for defining the Transaction Amount limit, beyond which the system will not default the Auto Exchange Rate.

All valid currencies defined in the Currency Pair Maintenance will appear for selection. The Currency2 should be part of a Currency Pair Maintenance in which the Currency1 defined here is the first currency. Currency 2 can be specified as ALL.

Specifying Limit Details

Rate Code

You need to specify the Rate Type (code) for the Exchange Rate Limit

Limit Currency

You need to specify the currency in which the Limit Amount should be expressed. All valid currencies defined in the system will be applicable for selection. There will be a validation for the limit currency as either Currency1 or Currency2.

Limit Amount

You need to specify the maximum amount up to which the system should default the Exchange Rate or perform the Rate Variance validation.

12.1.0.1 Validating Exchange Rate Limits

The Funds Transfer Contract Input will default the Rate only if the Transaction Amount is less than the Maximum Amount defined for the Rate Code maintained at the product level for FT. If the amount is more than the specified amount, then the system will not default the Rate. Instead, it will force the user to enter the Rate. Once the user enters the Rate, the system will not add the Customer Spread etc. as this will be final Exchange Rate for the contract.

The Rate Variance validation will also be done only if the amount is less than the maximum amount defined for the Rate Code maintained at the product level for FT. If the amount is more than the specified amount, the system will not perform the Rate Variance validation. Instead, there will be an override to specify that the transaction amount is greater than the maximum amount for Rate Variance check.

For details about how limits are applied when a transaction is entered, refer the chapter Processing a Funds Transfer, in the Funds Transfer user manual.