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Penalties on a Single loan

Any penalty can be attached to a single loan using the Penalty for a single loan option. When a penalty is charged, an additional installment on the loan is included as at that particular date.

Note that before you can be able to charge penalties on loans in arrears

1. LPF should have been configured to charge and penalize loans under System Configuration/Loan Product Settings/Penalties Settings.

2. Also note that penalties can be configured to be charged automatically under System Configuration/Loan Product Settings/Penalties Settings then select option "Automatically calculate penalties” or “Automatically calculate penalties at logon”. This window allows automatic calculation of penalties on loans in arrears for several loans.

3. Also note that for the loan charges to appear in the Report on fees received, ensure that they have been configured under Support files/show more/charge items.

4. You can then be able to enter loan charges and penalties under Loans/Penalties or Charge on a single loan and Loans/Penalties on arrears.

5. You can also be able to view the report on charges under Portfolio Reports/Reports on Repayments/Report on Fees Received and you select the option "Loan charges".

6. Also ensure that the GL accounts for booking Loan Charges are set at System/Configuration/Loan product settings/GL Accounts 2/2.

How to charge Penalties on a Single Loan

To charge penalties on a single loan you go to Loans\Penalty for a single loan and a Which Loan Number? dialog is displayed:

• Loan Number: Enter the loan number that should be penalized in the loan number box, e.g., "KA/000007" or click on the Choose command button to choose the loan from the list that is displayed.

Click on the Next button to continue. (A Penalty to loan ...… dialog is displayed)

• Last Entry: This field is read only and will display the date when the last transaction was made for this loan.
• Date: Enter the penalty date in the date box, e.g., "31/12/2011".
• Penalty: Enter the amount of penalty in the penalty box, e.g., "500,000".  

Click on the Save command button to complete.

 Additional notes: In the screen above "Last Entry" is the date on which the last loan repayment/Penalty calculation was made. Otherwise if there were no loan repayment or penalties charged for a loan, the field will be blank. The date shown is read only.

The penalties calculated will be reflected in the Loan Ledger Card for a client and in the Penalties Charged vs Penalties Paid Report.

Click on the Close command button to exit.

Related Topics

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