Price Item (Financial Services Business)

A bank may offer wide range of services to its customers. For example, Direct Debit, Credit Transfer, Stop Payment, etc. Oracle Revenue Management and Billing enables you to define each service as a price item. Once a price item is created, you can define pricing for the price item and then create charges against it in the system. You can define pricing at various levels in the customer hierarchy. For more information, see Price Assignment Search Mechanism.

You can group two or more price items together. While associating a price item with another price item, you need to indicate how the child price item is related to the parent price item. The system enables you to relate two price items using either of the following relationship types:

• Child Price Item

• Custom

• Other

• Price Item

• Product Group

• Service

• Service Group

For example, you can create two price items named Credit Transfer (CRTRN) and Credit Refund (CRRFD) and then associate the CRRFD price item with the CRTRN price item using the Child Price Item relationship type. The grouping of price items is done only for the informational purposes and it does not has any billing impact.

You can also create a price item bundle and then add price items to the price item bundle. For example, you can create a price item bundle named Fund Transfer (FDTRN) and then add the CRTRN and CRRFD price items to the bundle. You may use a price item bundle in the following scenarios:

• To offer volume discounts by charging a lower price for a group of services

• To group high and low selling services together

Based on the requirements, you can define the following types of price item bundles in the system:

The system enables you to create price items or price item bundles which can be used for:

• Pricing - It means that pricing can be defined for the price item or price item bundle, but no charges can be created against it in the system.

• Pricing and Billing - It means that pricing can be defined for the price item or price item bundle and charges can be created against it in the system.

The system enables you to create the following types of price items or price item bundles:

• Rate Based Price Items - The interest rate based services would include services on which interest is charged to the customers (for example, loan interest which is calculated on the borrowed amount) or services on which the interest is paid to the customers (for example, savings interest which is calculated on the daily outstanding balance). At present, you can define interest rate based price items which can be used for only pricing and not pricing and billing. Also, you cannot create interest rate based price item bundles in the system.

• Fees Based Price Items - The fees based services would include services on which fees is charged to the customers either annually or at regular intervals (for example, ATM service for which the bank charges annual fee). You can create fees based price items or price item bundles which can be used for pricing or pricing and billing in the system.

You need to associate a contract type with a price item or price item bundle. The system allows you to create a charge (i.e. billable charge) for a price item or price item bundle on an account when a contract of the contract type which is associated with the price item or price item bundle is already present on the account. You can specify a contract type when a price item or price item bundle is used for pricing and billing. If a price item or price item bundle is used for only pricing and not pricing and billing, the system automatically associates the contract type, which is specified in the Default Contract Type option type of the C1_​PRICING feature configuration, with the price item or price item bundle.

You can assign a price item or price item bundle to a person, account, or price list. While assigning a price item or price item bundle, you need to define a pricing for the price item or price item bundle. You can define a standard price for a price item or price item bundle in the price list and then assign the price list to one or more persons or accounts. For more information about price list, see Price List. You can also define an override price for a price item or price item bundle that is specific to a person or account.

You can create price items or price item bundles which can be assigned to any price list except global price list or which can assigned to only global price lists. For more information about global price list, see Price List.

You can define a price item manger To Do type and To Do role for each price item or price item bundle. The system creates a To Do using the price item manager To Do type when the deal creator or approver requests the price item manager (i.e. clicks the Send Price Items for Approval button) to approve the average price for the price item or price item bundle offered in a deal. The users with the price item manager To Do role can only approve the average price for the price item or price item bundle offered in a deal. Note that the price item manager can approve the average price when it is within the average price floor and ceil limits of the price item manager To Do role.

You can associate one or more parameters where the parameter usage is set to Price Item with a price item or price item bundle. These parameters can then be used for:

• Aggregating transactions which are mapped to the price item or price item bundle

• Defining multi parameter based pricing for the price item or price item bundle

If the parameter usage is set to Aggregation while associating a parameter with a price item or price item bundle, the parameter is only used for aggregating transactions which are mapped to the price item or price item bundle. However, if the parameter usage is set to Pricing while associating a parameter with a price item or price item bundle, the parameter is used for aggregating transactions as well as for defining multi parameter based pricing for the price item or price item bundle. Note that you can associate parameters only to regular price item bundles and not to ratio and phantom price item bundles.

You can associate a price item or price item bundle to one or more divisions. You can assign a price item or price item bundle to an account, person, or price list when the account, person, or price list belongs to the division to which the price item or price item bundle is associated. In addition, you can do the following when a price item or price item bundle is associated to a division:

• Associate the Service Quantity Identifiers (SQIs) with the Price Item or Price Item Bundle for the Division

• Define the Accrual Type Criteria of the Price Item or Price Item Bundle for the Division

• Associate the Price Item or Price Item Bundle with a Hierarchy Entity in an Entity Hierarchy Relationship of the Division

• Define the Cost of the Price Item or Price Item Bundle for the Division

• Define the Average Price Floor and Ceil Limits of the Price Item or Price Item Bundle for the Division

• Define the Division-Specific Characteristics for the Price Item or Price Item Bundle

Related Topics

Parent Topic: Pricing Management