4.2 Collateral/ Collateral Pool Block

This topic describes about collateral/ collateral pool block.

Banks often need to ensure that pledged collateral are reserved as security for a customer’s intended future loan contracts. By 'blocking' (or reserving) a portion of the customer's overall collateral, banks can guarantee that these assets cannot be used to secure other borrowings or obligations, ensuring that adequate security is always available for designated contracts (such as bilateral loans, trade finance, or guarantees). This collateral blocking reduces the risk of insufficient collateral, improves risk and compliance management. The functionality, referred to as ‘Collateral blocking' enables the bank to efficiently monitor and meet security requirements for customer commitments.

Note:

  • Collaterals Block screen should be used only to trigger corrective transactions in the ECM system when a transaction was initiated by an external product processor and successfully completed in the originating system.
  • Block details for each transaction that takes place in the external product processor must be sent to Oracle Banking ECM via the Gateway Online Inbound or Gateway Batch Inbound process.
  • During block transaction, Decrease block will restore the available balance.
  • All Actions that are available for Utilization are also supported for Block transactions – you can refer to earlier section for details.

Parent topic: Transactions