Through this section, you will set the calculation method for the Fee Amount:

Flat

When selecting "Flat" as the fee amount option, it means that the fee amount charged will be a fixed or flat rate that does not change. once “Flat” is chosen, all you have to do is enter the flat amount you wish to apply.

% of Approved Amount

When choosing "% of Approved Amount" as the fee amount option, it means that the fee amount charged will be a percentage of the approved loan amount, which is the amount that the borrower has been approved to borrow.

% of Unutilized Approved Amount

When choosing "% of Unutilized Approved Amount" as the fee amount option, it means that the fee amount charged will be a percentage of the portion of the approved loan amount that has not yet been utilized or borrowed by the borrower.

% of Unutilized Disbursements From First Disbursement

When choosing "% of Unutilized Disbursements From First Disbursement" as the fee amount option, it means that the fee amount charged will be a percentage of the portion of the loan disbursements that have not yet been utilized or borrowed by the borrower, starting from the first disbursement.

% of Unutilized Disbursements By Utilization Period

When choosing "% of Unutilized Disbursements By Utilization Period" as the fee amount option, it means that the fee amount charged will be a percentage of the portion of the loan disbursements that have not yet been utilized or borrowed by the borrower, for a specific period of time or utilization period.

% of Unutilized Expected Disbursements

When the fee amount is set to "% of Unutilized Expected Disbursements" it means that the fee charged to the borrower is calculated as a percentage of the difference between the total expected disbursements and the amount out of the disbursements that have been utilized.

% of Disbursement

When the fee amount is set to "% of Disbursement" it means that the fee charged to the borrower is calculated as a percentage of the actual disbursement amount received by the borrower.

% of Outstanding Principal

When the fee amount is set to "% of Outstanding Principal" it means that the fee charged to the borrower is calculated as a percentage of the outstanding principal balance on the loan.

% of Outstanding Principal & Compounding Interest

When the fee amount is set to "% of Outstanding Principal & Compounding Interest" it means that the fee charged to the borrower is calculated as a percentage of the outstanding principal balance on the loan, plus any accrued and unpaid interest on the loan that has been compounded.

Compounding interest refers to the interest that has been added to the loan balance over time and has been capitalized (i.e., added to the principal balance) at regular intervals. The interest accrues on the outstanding principal balance, so the compounding interest increases as the loan balance remains outstanding.

% of Outstanding Principal & Interest

When choosing "% of Outstanding Principal & Interest" as the fee amount option, it means that the fee amount charged will be a percentage of the outstanding principal and interest of the loan. This means that the fee charged will be calculated based on the amount of the loan principal that is still outstanding and the amount of interest that has accrued on that principal.

% of Outstanding Principal & All Interests

When choosing "% of Outstanding Principal & All Interests" as the fee amount option, it means that the fee amount charged will be a percentage of the outstanding principal and all interest amounts of the loan. This means that the fee charged will be calculated based on the full amount of the interest that has accrued on the loan, rather than just the interest that has accrued on the outstanding principal.

% of Expected Outstanding Principal

When choosing "% of Expected Outstanding Principal" as the fee amount option, it means that the fee amount charged will be a percentage of the expected outstanding principal of the loan at the time the fee is due.

The expected outstanding principal is calculated based on the loan's amortization schedule, which takes into account the loan amount, interest rate, payment frequency, and payment term. The amortization schedule shows how the borrower's payments are applied to the principal and interest over time, and how the loan balance decreases as payments are made.

% of Expected Outstanding Principal & Compounding Interest

When choosing "% of Expected Outstanding Principal & Compounding Interest" as the fee amount option, it means that the fee amount charged will be a percentage of the expected outstanding principal and compounding interest of the loan at the time the fee is due.

Compounding interest refers to the interest that has been added to the loan balance over time and has been capitalized (i.e., added to the principal balance) at regular intervals. The interest accrues on the outstanding principal balance, so the compounding interest increases as the loan balance remains outstanding.

% of Expected Outstanding Principal & Interest

When the fee amount is set to "% of Expected Outstanding Principal & Interest" it means that the fee charged to the borrower is calculated as a percentage of the expected outstanding principal balance on the loan, plus the expected interest to be accrued over the remaining term of the loan.

% of Expected Outstanding Principal & All Interests

When the fee amount is set to "% of Expected Outstanding Principal & All Interests" it means that the fee charged to the borrower is calculated as a percentage of the expected outstanding principal balance on the loan, plus all the interest that has been accrued.

% of Principal Repayment

When the fee amount is set to "% of Principal Repayment" it means that the fee charged to the borrower is calculated as a percentage of the amount of the loan principal that the borrower has repaid.

CPI Average

When the fee amount is set to "CPI Average" it means that the fee charged to the borrower is tied to the Consumer Price Index (CPI) average. CPI is a measure of the average change in prices of a basket of goods and services over time and is used to track inflation.

Discounting

When the fee amount is set to "Discounting" it means that the fee charged to the borrower is determined based on the present value of the expected cash flows of the loan.

In finance, the concept of discounting is used to determine the present value of future cash flows, taking into account the time value of money.

In the case of a loan, the expected cash flows include the principal amount, interest payments, and any fees that will be charged. The present value of these cash flows is calculated by discounting them back to their current value using a discount rate.

Flat Minimum Interest

When choosing "Flat Minimum Interest" as the amount option for a fee in a loan management system, it means that the fee will be calculated as a fixed percentage of the loan amount, but with a minimum amount specified.

Months for Minimum Interest

This method is used to secure X months of interest (in case of an early redemption). The amount entered here is the minimum number of months that interest should be charged. In case of an early redemption, the charge will cover the remainder period on a minimum interest charge.

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