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## 2.7.1.5 Stage Definition

This topic describes about configuring the repayment schedule of the loan accounts opened under this product.

This topic describes the instructions to configure various stages of loan product. Each stage can be any of the below installment payment types - Interest only Installment (IOI), Moratorium(MOR), Equated Periodic Installment (EPI), Post Maturity Installment (PMI) etc. Single or multiple of these stages can be defined for the product. Loan repayment schedule is drawn using the above stage definition. For example, we can configure a student education loan to have MOR stage followed EPI stage.

1. Click Next in the Restriction Preference screen to define the stage.
   The Stage Definition screen is displayed.

   Figure 2-58 Stage Definition

   Description of "Figure 2-58 Stage Definition"
2. Specify the fields on Stage Definition screen.

   Table 2-54 Stage Definition - Field Description

   Field | Description
   --- | ---
   + button | Click to add a row.
   - button | Click to delete a row that is already selected.
   Stage Name | Specify the name for each stage as per bank's naming convention.
   Stage Type | Select the stage type from the drop-down list. The available options are: Equated Periodic Installment Interest Only Installment Moratorium User Defined Schudule . The allowed values are defined by the lookup type STAGE_TYPE
   Installment Computation Method | Select the method as PMT Formula Method from the drop-down list. The available options are: PMT Formula Method Annuity Method PMT Recursive Formula Method This field indicates the formula for the computation of installment amount for the stage. The allowed values are defined by the lookup type COMP_METHOD.
   Installment Due Type | This field indicates whether the installments will become due at the beginning of the installment period or at the end. Select the due type as Arrears from the drop- down list. In this type of method, the installment is due at the end of the installment cycle. The allowed values are defined by the lookup type INST_TYPE.
   Installment Frequency | This field indicates the frequency when the installment amount will become due for payment for the configured stage. Different stages can be configured to have different payment frequency. Select the frequency from the drop- down list. The allowed values are defined by the lookup type INST_FREQ.
   Component Applicable | Select the component as All Components from the drop-down list. This field indicates different definitions for each component type at the stage level. The allowed values are defined by the lookup type COMP_APPLICABLE.
   Default Stage Duration | Specify the default stage duration which percolates or defaulted down to the account. The allowed values are defined by the lookup type STAGE_UNIT.
   Maximum Stage Duration | Specify the maximum stage duration (cumulative) allowed for the stage type at the account level.
   Stage Duration Unit | Select the duration as Months from the drop-down list. This field is unit value of duration for the values entered in Default Stage Duration and Maximum Stage Duration. For example, maximum stage definition and stage duration unit can be expressed as 36 months, which means maximum duration of the configured stage in loan account can be only upto 36 months.
   Interest Compunding Frequency | This field is defaulted to None. Note: This field is for future use.
   Excess Interest Behavior | This field specifies the treatment for the excess interest amount (i.e. when the interest amount computed for the schedule period is more than the installment amount). Select the interest behaviour from the drop-down list. The available options are: Capitalize Charge Carry Forward to Subsequent Installments The allowed values are defined by the lookup type EXCESS_INT_TREATMENT.
   End of period behavior | This field specifes the treatment for accrued components (i.e Interest) at the end of the stage term. The available options are: No Treatment Required Carry Forward to First Installmen Capitalize Interest Spread across loan term equally Carry Forward with Notional Captalization The allowed values are defined by the lookup type END_PERIOD_BEHAVIOUR.

3. Click Back to go back to previous tab.
4. Click Cancel to close the details without saving.
5. Click Save and Close to save the details.
   The Contract Template is successfully created and can be viewed using the View Product screen.

Parent topic: Create Product