Accrued interest

There's no system design problem beyond a need to make it more obvious to operators that they are about to make an early payment with a "are you sure you're sure?" dialog box.  All repayments are currently handled manually so it is up to the website admin team to make the correct payments at the correct times when funds are received with the system providing guidance as to what is due.

We're making good progress with the bank now with automated bank access which will then allow me to process all loan repayments automatically, including those where interest is retained.  This will be my main focus after the basic automation is in place for lender accounts.

Client money rules prevent us prematurely moving money around, it has to be moved as it is allocated to lender accounts.

Reversing the transactions paid early isn't a problem with the new system, it's a problem with some lenders having already reinvested that money.  Do we start seizing and selling loan units, leave things in a half way state with some money reclaimed some money still in lender's hands, force lenders to transfer new funds in to cover their purchases, etc.  There's no elegant way of solving the issue, at least that I can think of.

Default interest is easy to apply within the system, the loan model is fully flexible in that regard, but it requires a manual intervention.  For example if a loan is repaid 1 day late then we're not going to go back and chase the borrower for that one day of default interest.  Technically someone buying into that loan on that day would earn 0% interest on their investment, so the system reflects that.  Once an admin decides that a loan has defaulted beyond any grace period and default interest applies then they can reflect that within the system and it's retrospectively calculated from the date the loan entered default.  Perhaps one day we'll have rules that are set in stone on this (from an IT perspective) but for now it remains at the admin team's discretion and therefore requires manual input.

Ultimately yes.  Once I have automated access to the bank account then I can full manage the flow of cash and automate repayments.  This will happen in stages - first we'll sort out lender deposits so they are credited within the system within 1 hour; then we'll move on to payments out of the system; then I'll focus on automating borrower repayments and the ancillary controls and process that would need to surround that; then I can look at automating movements of cash between our own bank accounts to allow for automatic processing of payments where we hold funds in reserve.  So it's not going to be a quick fix but it will happen and has a large benefit to the business to automate, giving it a good chance of being prioritised.

chris:  Are you saying, then, that inasmuch as the money to pay the £27,187.50 interest payment due on 13/Mar was retained by AC at the time Loan #130 was extended, the reason for this payment not being credited to lenders' accounts on the day it was due is operator/admin error?

If so, can you please ask the appropriate person to make sure that this payment is made on Monday?

Thanks.

Mysterious G**** Th*****n located & interest now paid on #130

I've forced a recalculation of accrued interest on all loans.  Can you verify if the accrued interest figure on that loan is as you would expect?  I don't have a valid reason for it decreasing unless it was either previously over reporting or you were mistaken?  Hate to suggest the latter but need to clear it off.

I've also had an idea that will elegantly solve the accrued interest problem without needing to make extensive changes elsewhere so I can get it implemented today.  The main reason we hadn't been able to fix the issue thus far was because our long term plan involved restructuring the way the accrued interest was stored which had a lot of knock on effects throughout the rest of the code base.  Whilst the change itself was relatively simple it was that knock on effect that made it impractical to tackle.  I've just had an idea that lets me side step that problem to buy us as much time as we need.