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Table of Contents (Online Help)

Loan Approval

After a careful assessment of the applicant’s ability to repay a loan which is derived from the selection and screening process, the loan officer or loan committee can proceed to approve the loan for the applicant.

This window of Loan Performer is used to approve, reject or defer a loan application depending on the evaluation earlier made.

How do we approve or reject a loan application.

To approve or reject a loan application, go to Loans/ loan approval, a screen like one below appears:

Note: The loans applied for under the menu Loans/Loan application appear in the grid above. Click on the loan you want to approve or reject and its details will appear in the corresponding fields under the grid.

• Approved amount: The loan amount to approve automatically appears in the field when you click on it on the grid e.g. "4,000,000" UGX.

Note:

1. You have to tick the radio button corresponding to the action you wish to take: To accept the loan application select "Approve", to refuse the loan application select "Reject" and to postpone the loan application , select "Defer".

2. When you opt for refusing the loan application by selecting the option "Reject", another field "Reason for rejection" appears to allow you to enter the reason why you are refusing to give the borrower the loan e.g. "Not reliable" (See the image below). The reasons for loan rejection should have been specified under Support files/Loan Rejection.

• Note:
  
  1. The field "Approved amount" is no longer read only to enable the user to modify the loan amount applied for by the client. You can enter a lower amount e.g. "3,500,000" UGX that is approved instead of the "4,000,000" that was applied for. This follows the decision of the Credit committee of the MFI which verifies loan applications. It is no longer necessary to ask the client to re-apply asking for the amount approved by the committee because LPF gives a report showing the "Amount applied for" and the "Approved amount" (See the report image below). For more information about this report, go to Loans/Portfolio reports/Approved/Rejected/Pending Loans.
  
  2. Also note that when this option is used the system will automatically revert to Loan Application process with the approved amount being read only. See the image below:
  

• I< << Page 1 of 1 >> >I: Click on these arrows to move to the next or previous page.
• Date of Approval / Rejection/ Deferred: Enter the approval date here e.g. "02/02/2016".
• Comment: Type here the comment that you think is necessary to the approval process e.g. "The Credit committee preferred to reduce the loan amount".
• Search on Name: This feature enables you to quickly find a name from the list of loans to approve if they are many. Just type the first few letters of the client's name in the provided space e.g. "Ni" for Niwagaba).

Below is the report showing the "Amount applied for" and the "Approved amount".

Note: In case of an error and you wish to reverse the approval, you go to the menu "Loans/Delete Loan Entries/Delete Loan Approval" and delete it. The loan will again be available for approval. The same loan will also appear under the menu Loans/Modify Loan Applications just in case you want to modify loan application.

Click on the Save button to complete the approval. The loan will be removed from the approval list and placed on the list of loans pending disbursement.

Related Topics

Contact LPF live support for more information
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