Floating Rate Change

8.4.4.4 Floating Rate Change

While defining Floating Rates, you have the option of indicating whether the floating rates should automatically be applied to the bill every time they change, in the Product ICCB screen.

The Automatic Floating Rate Change function run as part of EOD.

This function will pick up:

Active and authorized bills
Bills for which you have specified automatic Floating Rate change

Every time the Floating rates change, the new rates will be applied for the number of days for which they remained unchanged in the rate table.

This is indicated in the example below.

The rates in the floating rate table change in the following manner:

Table 8-7 Floating rate

Effective Date	Rate
1 October 1999	12%
12 October 1999	11.5%
25 October 1999	11%

The rates will be applied for the number of days for which they remain unchanged in the rate table, as follows:

From	To	Rate
1 October 1999	11 October 1999	12%
12 October 1999	24 October 1999	11.5%
25 October 1999	31 October 1999	11%

You have entered a bill, which has a Base Date as 1 October 1999 and matures on 30 November 1999. The interest accrual frequency is to be monthly. The bill has been linked to a floating interest rate.

If the first interest accrual is to be done on 31 October, all the rate changes between 1 October and 31 October will be considered automatically.

Parent topic: Automatic Status Changes