Redemption Fees for Withdrawals

Redemption fees can be applied to a withdrawal when the withdrawal occurs before the deposit has matured. OIPA can validate that the redemption fees apply to a withdrawal and can determine the amount to apply.

A prototype configuration has been created to demonstrate this feature. View prototype.

Configuration Required

The following configuration must be in place to support redemption fees.

  • The FundScreen rule must contain dynamic fields for the redemption factor and the redemption duration. The name of these fields is important and must be referenced exactly in the RedemptionAmountFormula rule.
    • The Redemption Factor is used by the RedemptionAmountFormula rule to calculate redemption fees. This should be entered as a decimal value that indicates a percent. For example, 0.01 would be 1%. The default value is 0.00
    • The RedemptionFee is an existing dynamic field, which by default is set to 01. This indicates that OIPA should look at fund details to calculate fees.
    • The RedemptionDuration identifies the number of days the deposit must sit in the policy account before a withdrawal can occur. If the age of the deposit is less than the date when the withdrawal occurs, then the withdrawal is subject to redemption fees.
  • The RedemptionAmountFormula rule defines the calculations that must be performed to determine the redemption fee. It must reference the Fund screen redemption factor and redemption duration field names exactly. The redemption factor and redemption duration are retrieved from the FundScreen rule. A math variable is identified that pulls the values using the prefix Fund: and then the name of the dynamic field from the FundScreen rule. For example, Fund:RedemptionFactor pulls the value from the Redemption Factor field on the Fund screen.
  • A transaction must be configured with the assignment types that contain the redemption attributes REDEMPTIONFEE and REDEMPTIONMONEYTYPE.
  • Funds that support the use of redemption fees must have Fund fields identified for Redemption Fee, Redemption Factor and Redemption Duration.