Moratorium Interest Accounting Entries

Liquidate Immediate

Moratorium interest is collected on due date of moratorium for moratorium component.
Accrual for moratorium component is posted with following entries

Table 16-58 Accounting Entries

Event	Accounting Role	Amount Tag	Dr/Cr
ACCR	Main_Interest_M_REC	Main_Int_M_ACCR	Dr
-	Main_interest_M_INC	Main_Int_M_ACCR	Cr

Liquidation of moratorium interest is posted with following entries

Table 16-59 Accounting Entries

Event	Accounting Role	Amount Tag	Dr/Cr
LIQD	CUSTOMER	Main_Int_M_LIQD	Dr
-	Main_interest_M_REC	Main_Int_M_LIQD	Cr

Liquidate With First Schedule

Loan contracts created with moratorium type as liquidate with first schedule adds moratorium interest to main interest component first schedule due date

On due date of moratorium, moratorium interest will be settled by accumulating to main interest component first schedule due date

Table 16-60 Accounting Entries

Event	Accounting Role	Amount Tag	Dr/Cr
LIQD	Main_interest_REC	Main_Int_M_TRFR	Dr
-	Main_interest_M_REC	Main_Int_M_TRFR	Cr

Liquidate Across Schedule

Loan contracts created with moratorium type as liquidate across schedule adds moratorium interest to across schedules of main interest component

On due date of moratorium, moratorium interest is settled by accumulating to main interest component with following accounting entries.

Table 16-61 Accounting Entries

Event	Accounting Role	Amount Tag	Dr/Cr
LIQD	Main_interest_REC	Main_Int_M_TRFR	Dr
-	Main_interest_M_REC	Main_Int_M_TRFR	Cr

Capitalization of Moratorium Interest

Loan contracts created with moratorium type as Capitalize adds moratorium interest to across schedules of Principal component

On due date of moratorium, moratorium interest is settled by accumulating to principal with following accounting entries.

Table 16-62 Accounting Entries

Event	Accounting Role	Amount Tag	Dr/Cr
LIQD	Asset GL	Main_Int_M_CAP	Dr
-	Main_interest_M_REC	Main_Int_M_CAP	Cr

For Amortized loans, the moratorium interest is equally divided across all the schedules falling after moratorium end date (considering the projected moratorium interest) with EMI and the effects will be displayed in schedule details upfront itself.

On moratorium interest rate change during moratorium period, the projected moratorium interest changes. Hence the EMI or schedules are recalculated.

Payment is not allowed during moratorium period. The actual interest capitalization happens on the moratorium end date. No schedule recalculation is done at this stage as the effect of capitalization has already been considered in the schedules.

Consumer Credit

Loan contracts created with moratorium type as ‘Consumer Credit’, schedule adds the moratorium interest to the upcoming few leading schedules (not across schedule) of main interest component after adjusting the moratorium interest with principal amount.
Consumer Credit type supports only amortized loan and it equally split the EMI amount across all the schedules.
On due date of moratorium, moratorium interest is settled by accumulating to main interest component with following accounting entries.

Table 16-63 Accounting Entries

Event	Accounting Role	Amount Tag	Dr/Cr
LIQD	Main_interest_REC	Main_Int_M_TRFR	Dr
-	Main_interest_M_REC	Main_Int_M_TRFR	Cr

Extension of moratorium period

In case of VAMI Principal Increase during moratorium period, the projected moratorium interest changes according to the Principal increase. Hence the EMI or schedules are recalculated.
Moratorium schedule amendment should not be supported once moratorium end date is crossed, which includes back value dated amendment also.
Moratorium end date reduction should not be less than the current system date.