Hi Emily,
I really appreciated your well-reasoned clarifications. I will discuss the
issue with Nazir and come back with more comments about.
I will contact you if we need a verbal discussion.
Regards.
_____________________________________________________________________
Mss Nesrine MADHKOUR
Finance Solutions Consultant
OXIA
OXIA is ISO 9001 V2000 certified company - AFAQ QUAL/2005/25140
11, Rue Claude Bernard
1002 Tunis Belvédère
Tunisia
Tel.: +216 71 28 27 00
Fax: +216 71 28 27 05
[EMAIL PROTECTED]
Skype : NesrineMadhkour
www.oxiasoft.com <http://www.oxiasoft.com/>
________________________________
De : [EMAIL PROTECTED] [mailto:[EMAIL PROTECTED] De la part de Emily Tucker
Envoyé : mercredi 20 février 2008 19:05
À : [EMAIL PROTECTED]; Aliya Walji
Cc : Mifos functional discussions
Objet : Re: [Mifos-functional] ENDA-Mifos: Loan schedule independent ofmeeting
schedule_Functional issue
Comments in Purple (sorry, I know this is bad mailing list etiquette)
To analyse this issue, I have created 4 loan products to simulate
different scenarios related to the loan schedule start date calculation (On a
previous version of Mifos before implementing the loan schedule independent of
meeting schedule feature):
1/ A loan which interests are not deducted at disbursement: the first
repayment date is different from the loan disbursement date.
2/ A loan which interests are not deducted at disbursement but on which
fees deducted at disbursement are applied: the first repayment date is also
different from the loan disbursement date.
3/ A loan which interests are deducted at disbursement: the first
repayment date is the same as the loan disbursement date.
4/ A loan which interests are deducted at disbursement and on which
fees deducted at disbursement are applied: the first repayment date is the same
as the loan disbursement date.
>A question:
>We also have fees that can be charged at time of disbursal. Does the
scenario you describe below also apply then?
Based on the above cases, it is obvious that fees applicable to loans
and deducted at disbursement don't follow the same logic of interests when
calculating the loan schedule start date.
Nesrine,
Thanks for doing this analysis! I've added a link to this email thread
to this section of the functional spec:
http://mifos.org/knowledge/functional-specs/loans#repayment-schedule
We will be updating the spec for v1.1, and will include clarifications
around the scenarios you just researched.
>My recommendation would be the following:
>If "interest deducted at disbursement" is ON, then the system should
consider the second payment as the "first repayment" and apply the logic for
scheduling the date of the payment accordingly. In some ways-- >it really is
the first repayment-- albeit only of principal
As a reminder: when implementing "loan schedule independent of meeting
schedule", we allow disbursal to happen on a non meeting day. However, if
interests deducted at disbursement attribute is turned on, and if we keep the
same logic which is having the first repayment date the same as the disbursal
date, we will have a loan schedule start date different from the loan repayment
days. That is why I think that we should keep the same loan schedule start date
whether interest deducted at disbursement are applicable or not. I.e the loan
schedule start date is the first meeting from the disbursal date (which defined
on the feature specifications).
The only difference between having interest deducted at disbursement or
not will be obvious actually only at disbursement (The amount of payment
details on the disbursal page).
Moreover, I think that if we consider the second payment as "the first
repayment" as recommended, min and max (especially max) window wouldn't have
any sense. The calculation of the loan schedule start date would be the same as
if we have a grace period of one instalment.
So I'm not sure if I fully followed this. :-) What I think you're
recommending is this:
(*) The "Start Date" for loan schedules (regarldess of whether or not
interest is collected at disbursement) should be the first repayment *after*
the disbursal date. (Above you mention that it should be the first meeting
after the disbursal date, but if we have loan schedule independent of meeting,
shouldn't it be the first repayment date?)
(*) If this happens, then the system would apply all the configurations
used to determine the next repayment day to that first repayment after the
disbursal date-- ignoring the interest paid at disbursement.
(*) There would be other impacts too... for example, if a loan is
defined to have 10 installments-- then the repayment of interest would not be
considered an installment. instead, the loan would have 10 principal repayments.
I actually think this is the right approach and I don't like the fact
that Mifos currently considers the interest deduction as the "first
installment". However, I'm worried that this change is actually a very
significant change in the system. There's a lot of logic to think through--
things like:
(*) How would the UI change on the Loan Repayment Schedule?
(*) Would there be any impact on how grace periods are handled
(probably not, but would have to research)
(*) And probably a lot of other issues I haven't thought of
I'm worried at making such a significant change given everything else
we're trying to do in this release. It seems very high-risk. I'm wondering if
there is an easier approach?
Right now,very few of the MFIs we've spoken with use "interest deducted
at disbursement". So if it's easier and if Enda doesn't need this feature, I
think it's OK if we disable "loan schedule independent of meeting schedule" if
interest is deducted at disbursement. Would that be easier to implement?
Do you have any other ideas?
Nesrine-- I know you need to close out on this issue quickly-- so feel
free to IM me if you need to discuss this verbally.
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