Introduction to Deposits

Term Deposit (TD) is a product offered by the banks that provide interest rate in exchange for customers agreeing to leave a lump-sum of money with the bank for a fixed period or term. The bank requires to the ability to provide Term Deposit servicing functionalities for customers.

The interest received by the customer is reduced by break cost fee if early withdrawal happens on term deposit.

The benefits of using this module are as follows:

• Ability to charge Break Cost Fee in case of early withdrawal / redemption of Term Deposits. The Break Cost Fee is the system calculated difference between the original rate (for full term) and the actual rate due to early withdrawals and adjust the same from the accrued interest balance.
• Ability to determine the reduced rate based on the time elapsed of a deposit and notice withdrawal validations.
• Ability to handle the partial withdrawal restrictions in case of partially funded deposits.
• Ability to collect or not to collect break cost fees during the grace period after arrangement creation during the grace period after rollover.

In case the calculated break cost fee is less than the minimum fee, then the minimum break cost fee will be charged and also, the break cost fee will be applied for the notice period where partial or full withdrawal in a deposit will happen on a future date.

The following items have been released as part of this module:

• The AUDEPO.PARAMETER application has been released as part of this module to define the business rules and to store the applicable reduction of original rate based on the time elapsed in case of early partial and full withdrawal.
• The AUDEPO.PARAMETER,INPUT and AUDEPO.PARAMETER.NAU versions have been released as part of this module to configure and authorise the performed configurations in the AUDEPO.PARAMETER application.
• The AUDEPO.BREAK.DETAILS application has been released as part of this module to store the break details like, break amount, break reason (if any), effective interest rate, reduced rate percentage, effective applicable rate, etc. This application will be updated after the online break request is completed on the same day, and for notice withdrawal requests, it will be updated after the withdrawal is complete on the effective day of withdrawal.
• The AUDEPO.BREAK.DETAILS.LIST enquiry has been released as part of this module to list the break details.
• The Withdrawal Reason field has been added to the AA.ARRANGEMENT.ACTIVITY application to capture the reason for early withdrawal of deposit. The withdrawal reason will be inputted by the user at the time of early withdrawal, and this will be required for parameter validation. The validation of the withdrawal reason is required to levy or not to levy the break cost fee in case of early partial withdrawal.
• The Check Notice Reason flag has been added to the AUDEPO.PARAMETER application to allow users to choose if the break cost is not applied for the reason defined during the capture or execution.
• New fields have been added to the AUDEPO.PARAMETER application to configure the default grace period, grace period check for new arrangements and the grace period check for rollover arrangements.
• APIs have been introduced as part of this functionality to execute or simulate, partial or full withdrawals in a deposit by applying a break cost fee, amend and cancel notice withdrawals and retrieve the details of the early partial or full withdrawal.