2.32 Auto-Closure of Account Basis Balance Threshold in Oracle Banking Retail Accounts
This topic describes the auto-closure of an account basis balance threshold in Oracle Banking Retail Accounts.
System has the capability to auto-close an account basis the balance maintained over a certain period. This is essential for the bank to identify those accounts that bring in minimal business for the bank while the bank incurs cost of maintaining these accounts. The preferences data segment in the business product configuration screen is enhanced to include an optional section to define the account auto close paramteres. These parameters include the auto-closure applicability, the auto-close balance threshold. auto-close threshold days and balance transfer GL.
For example,
If this value of,
Auto-close Balance threshold Currency = USD
Auto-close Balance threshold Amount = 5 (For US markets, this value can be configured to ‘0’)
Auto-Close threshold days = 15 days.
Then any accounts associated with the business product, will be closed if the balance maintained in the account is <= $5 for a period of 15 days continuously.
All the validations applicable for a manual account closure will also be applicable for auto-account closure. If any of the validations fail, the account will not be auto-closed and will remain active.
Note:
An accounts with draft balance (negative balance) are not considered for auto closure of Accounts. As per adopted banking practices, Closing of Accounts with trivial negative balances (Debit), will be treated as write-off and this will be carried out with proper approvals from Credit Committee of Board. Once the approvals are obtained, the relevant asset monitoring department will pass accounting entries by debiting Profit and Loss Statement, and Credit the Account with Debit balances. Once these accounts become zero, they will be picked for auto closure after the threshold days.Parent topic: Operations