How Pay Plans Affect The Account Debt Monitor
As described under A Pay Plan Insulates Overdue Debt From The Account Debt Monitor, a pay plan's scheduled payments insulate an account's debt from the ADM. This section describes how this is accomplished.
You should understand the concepts in How Does The Account Debt Monitor Work and The Tendering Account May Differ From The Account Whose Debt Is Relieved before reading the following.
The ADM will be triggered when a pay plan is broken. Refer to The Pay Plan Monitor for an explanation of how the ADM is triggered when a pay plan is broken.
Before the ADM subjects an account's debt to the collection criteria, it calls the debt's debt class's Override Arrears Algorithm (this is an optional plug-in spot on Debt Class). This algorithm is passed the debt class's aged debt and manipulates it as follows:
- First, a list of all past, present and future scheduled payments
associated with the account and debt class's active pay plans is
constructed.
- If multiple payors are encountered (because the customer has multiple pay plans and these have different payors), a separate list of scheduled payments is maintained for each payor.
- Next, for each payor, retrieve the total amount of frozen, non-cancelled
payment segments made on behalf of the pay plan's account and debt
class.
- Select all frozen, non-cancelled payment segments associated with the pay plan's account and debt class whose pay date is >= pay plan's start date and the pay segment's event has at least one tendering account associated with the pay plan's payor.
- Next, logically reduce / remove past and current scheduled payments (starting with the earliest scheduled payment) until the payor's payment amount is exhausted (or there are no more historical / current scheduled payments). Future scheduled payments cannot be remove / reduced.
- Finally, reduce the passed in aged debt with any unpaid scheduled payments.
This logic is not "hard coded". Rather, the mechanism used to use a pay plan's scheduled payments to reduce debt is defined in an algorithm defined on the pay plan's debt class. The contents in this section describe how a base package algorithm works. Because it's an algorithm, you can introduce whatever logic you please.
The following is an example of how pay plans affect aged debt.
|
Date |
Event |
SA's Arrears |
SA's Balances |
Scheduled Payments |
|
Prior to creation of the PP 1/18/2000 |
$1,000 - 90 days old $1,600 - 60 days old $1,900 - 30 days old |
Current: $4,500 Payoff: $4,500 |
||
|
1/18/2000 |
Pay Plan created. The $4,500 in future scheduled payments offsets the existing $4,500 of aged debt. |
$1,000 - 90 days old $1,600 - 60 days old $1,900 - 30 days old De facto ADM debt: $0 |
Current: $4,500 Payoff: $4,500 |
1/20/2001 $1,500 2/01/2001 $1,500 2/07/2001 $1,500 |
|
1/20/2001 |
The customer pays $1,500. There exists $3,000 of future scheduled payments that offset the arrears |
$1,100 - 62 days old $1,900 - 32 days old De facto ADM debt: $0 |
Current: $3,000 Payoff: $3,000 |
1/20/2001 $1,500 "Paid" 2/01/2001 $1,500 Future 2/07/2001 $1,500 Future |
|
1/20/2001 |
ADM runs. The $3000 in future scheduled payments offsets the Current Balance of $3000, so CC events not created. |
$1,100 - 62 days old $1,900 - 32 days old De facto ADM debt: $0 |
Current: $3,000 Payoff: $3,000 |
1/20/2001 $1,500 "Paid" 2/01/2001 $1,500 Future 2/07/2001 $1,500 Future |
|
1/24/2001 |
A new bill is created for $400 |
$1,100 - 62 days old $1,900 - 32 days old $400 - 1 day old De facto ADM debt: $400 - 1 day old |
Current: $3,400 Payoff: $3,400 |
1/20/2001 $1,500 "Paid" 2/01/2001 $1,500 Future 2/07/2001 $1,500 Future |
|
2/2/2001 |
Pay Plan Monitor runs. PP marked as Broken because the 2/1/2001 scheduled payment has not been paid (assuming no grace period on the pay plan's payment method) |
$1,100 - 74 days old $1,900 - 44 days old $400 - 8 days old |
Current: $3,400 Payoff: $3,400 |
1/20/2001 $1,500 "Paid" 2/01/2001 $1,500 "Late" 2/07/2001 $1,500 Future |
|
2/2/2001 |
ADM runs. There are no active pay plans and therefore there is nothing to insulate the customer's debt. Therefore the aged debt will be subjected to the collection criteria and an appropriate collection process will be created. |
$1,100 - 74 days old $1,900 - 44 days old $400 - 8 days old De facto ADM debt is the same as above (i.e., rather old) |
Current: $3,400 Payoff: $3,400 |
Pay plan is broken and therefore its scheduled payments cannot be used. |