Loan Settings configures the whole lending and deposit operation — which ledger accounts everything posts to, the fees and charges you apply, and the reference formats your documents carry. Nothing should be issued before this is right.
Where to find it
Go to Customer Loan > Settings.
Lending accounts
| Setting | What it controls |
|---|
| Default Loan GL Account | Where the receivable from borrowers sits. |
| Default Interest Account - Expense | Interest recognised. |
| Default Differed Interest - Assets | Interest earned but not yet due. |
| Default Differed Interest - Liability | The corresponding liability side. |
| Default Commission Account | Commission on loans. |
| Processing Fee GL account | Fee income taken at disbursement. |
| Default Loan Payment Discount Account | Prompt payment discounts given. |
Penalty and pre-closure
| Setting | What it controls |
|---|
| Penalty Rate (% / month) | The monthly charge on overdue dues. |
| Grace Days | How long after a due date before penalty starts. |
| Penalty Income GL Account | Where collected penalties land. |
| Pre-closure Charge (% on outstanding) | What a borrower pays to settle early. |
| Pre-closure Charge GL Account | Where that charge posts. |
Deposit settings
| Setting | What it controls |
|---|
| Deposit GL Account | The liability to depositors. |
| Pre-mature Penalty (% off interest rate) | The rate reduction applied when a deposit is withdrawn early. |
| Pre-mature Charge GL Account | Where that charge posts. |
Reference formats
| Setting | What it controls |
|---|
| Loan Payment Ref Format | How loan payment references are built. |
| Deposit Ref Format | How deposit references are built. |
Separate penalty income from interest income in the account mapping. They are earned in completely different ways, and a book whose income is largely penalties is telling you something about its lending that a combined figure hides.
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