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## 3.4.2 Advantage Method

This topic provides the information about the Advantage method for Interest calculation.

In this method, the interest is calculated at each participant account as per their balances with an applicable rate, debits and credits posted to the participants accordingly.

Next interest is calculated based on the pool balance at notional header in notional header currency.

The difference between the interest arrived at the pool level and the summation of interest arrived at the participant level is called the Advantage Interest (Z-I).

To process the Advantage Method in the system, the pool type structure with Advantage method as interest needs to be created.

The required IC setup are as follows:

- Period Code Maintenance
- Branch Parameters
- Interest Rule Maintenance
- Product Maintenance
- IC Group Input (Mapping of Oracle Banking Liquidity Management and IC Group)
- IC Group Product Mapping (Mapping of Group to an IC Product)
- IC Rate code Maintenance
- Rate Input Maintenance
- UDE Value Input

Parent topic: Interest Calculation Methods