1.8.5 Mode of Repayment

The repayment schedules for interest should be defined for each contract. Depending on the mode of payment applicable, the interest will be liquidated, either automatically or manually, according to this schedule.

The mode of repayment for interest can either be automatic or manual. Specify this preference in ‘Code Usage’ field. When the repayment is automatic, interest will be liquidated on the schedule repayment dates automatically by the Automatic Contract Update program. On the other hand, if the repayment is manual, instructions for liquidation should be entered in the system when the repayment is made.

The mode of repayment has to be specified for a product, but you can change it for a contract.

For BC contracts, all outstanding accruals during full repayment are passed unconditionally during the YACR (YTM based discount accrual) event. To recall, this event is meant to indicate the periodic discount accruals for a BC contract.