Deferral

Use

You use this function within position management to defer overdue items and, if necessary, future payments of a loan. This involves transferring the overdue items of the loan, and the future payments that the borrower is unable to pay, into a deferral arrangement. This arrangement contains a payment plan that is independent of the normal installment plan for the loan.

The loan is retained with all data and the history. The deferral arrangement is like a contract but you enter it in the SAP system as a business operation and not as a loan with a separate loan number.

The deferral is regarded as a risk-increasing measure and is displayed as such in the loan contract.

This function does not support batch input.

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You can only use this function for loans that are based on the product category Consumer Loans (340), General Loans (330) and Mortgage Loans (300).

Integration

You can use this function in the Workplace for Business Operations . It contains the processing of the business operation with an integrated status concept (possible statuses are entered or activated ), and is linked to the release procedure.

Prerequisites

To be able to use this function you need to have executed the following IMG activities in the Customizing for Loans Management :

To use the deferral function for a certain product type, you need to have activated this for the product type in the IMG activity Define Product Types .

To enable the system to process the flows for the deferral correctly, you need to have defined the flow types, and the offsetting flow types for the flows for deferral, under Define Flow Types .

Deferral repayment (flow category DETT)

Deferral interest (flow category DETZ)

Deferral charge (flow category TB)

You need to have created the flow types for additional charges, so that you can add them to the additional flows, if required.

You need to have assigned offsetting flow types to the flow types in the IMG activity Assign Offsetting Flows, so that the system can clear the open items, and future payments, with the deferral amounts. In doing so, you need have used the relationship category Cleared by Deferral (110).

In the IMG activity Define Account Determination , you have defined the account determination for the flow types, for further processing of the amounts.

In the IMG activity Define Condition Groups you need to have made the following settings in the Assign Flow Types to Condition Groups per Application screen.

Assign the flow types for the deferral (deferral repayment, deferral interest and deferral charge) to the application sub function Deferral Other Flows (501)

Assign the flow types that you use for manual additional flows to the application sub function Deferral Manual Other Flows (502)

Assign the flow type for the deferral interest to the application sub function Deferral Interest (503)

Assign the flow type for the deferral repayment to the application sub function Deferral Repayment (504)

Assign the flow type for the deferral charge to the application sub function Deferral Charge (505)

In the IMG activity Define General Control Data (under Deferral ) you must have determined the tab pages that will be available in the application.

In Define Basic Settings (under Deferral ) you need to have defined which predefined values and settings take effect depending on the product type used.

In the IMG activity Define Reasons for Deferral (under Deferral ) you need to have defined the reasons for the deferral to be entered by the user.

In the IMG activity Define Postprocessing Reasons (under Deferral ) you need to have defined the post processing reasons to be entered by the user.

Only relevant for mortgage loans and general loans: In the IMG activity Define Deferral Charges (under Deferral ) you need to have defined the default charges to be levied for the deferral operation, which can be changed by the user.

Only relevant for mortgage loans and general loans: In the IMG activity Define Deferral Interest Values (under Deferral ) you need to have defined the default interest rate and its maximum and minimum deviations, which can be changed by the user.

Products and Conditions

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This section is only relevant for the product category Consumer Loan (340).

You can make the settings for this business operation in the product on which the loan is based. You define Products in the SAP Easy Access screen under Current Settings .

You need to have set up the conditions required for this business operation in the condition table assigned to the product. You define Condition Tables in the SAP Easy Access screen under Current Settings .

Interest on Arrears

If you want the system to calculate the interest on arrears due for this loan on the business operation key date when you execute this function, you need to have completed the following settings in Customizing for Loans Management .

You need to have set up the business operation category Interest on Arrears . For more information on the business operation Interest on Arrears , see Interest on Arrears .

In the IMG activity Define Condition Groups in the Assign Flow Types to Condition Groups per Application view , you need to have assigned the flow types for interest on arrears to the application sub function Deferral Flow Types (501).

In the IMG activity Activate Interest on Arrears Calculation per Business Operation Category you need to have activated the calculation of interest on arrears for the business operation category Deferral .

The system posts the interest on arrears when you post this business operation.

Release

If you want to use the release function within the deferral function, you must make the appropriate settings for the deferral in the activities Maintain Active Indicators , Define Release Status Parameters , and Maintain Workflow Settings in the Release section.

For more information, see the Prerequisites section in Release

Correspondence

If you want to use the correspondence function within the notice function, you need to carry out the IMG activities under Correspondence with Correspondence Tool (SAP Smart Forms) in Customizing for Loans Management .

In the IMG activity Define External Flow Types you need to replace the flow types relevant for deferral, such as processing charges, with external flow types and leave the field Report Category empty.

Scope of Functions

Along with general loan data such as company code, loan number or name and address of the business partner in the loans header, the system also displays the business operation status ( New, Entered, Activated, for example) in the Business Operation Header. In the Business Operation Description field you can either enter a posting text manually or select a text from the possible entries. When you post the payoff, this text is transferred to the Text field in the Additional Posting Data screen. You can change the default text here. Once the posting has been executed, the text appears on the FI document header.

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You define the posting texts that are available as possible entries in the IMG activity Define Company Code-Specific Texts.

Once you have entered the relevant data (see below), you can save, activate or post the business operation, as long as it does not need to be released first. The system displays the status of the business operation automatically. You cannot change this here.

If the release function is activated, you forward the business operation Deferral to the inbox of the Business Workplace using the To be released function. From there, it is released. You can release, activate, or post the business operation directly from the Release Function . The system also displays the release status in the Business Operation Header . You cannot change this here.

You can navigate to the following:

By choosing Cash Flow you can have the system display the current cash flow or recalculate and display the new cash flow, with or without consideration of the deferral.

If you have activated interest on arrears calculation for this business operation category, the system also displays the incurred interest on arrears for the loan on the key date in the cash flow.

By choosing Display Contract you can branch directly into the loan contract screen.

You can display the Loan Summary, the Total Commitment or the Account Statement for the loan.

Choose Generate Correspondence to generate the relevant correspondence for the deferral, dependent on language and partner role.

On the lower part of the screen you can make entries in the tab page that you activated in the IMG activity Define General Control Data . You can also define the initial tab page in Customizing. The following tab pages are available for the Deferral function:

Activities

In the SAP Easy Access Menu chose Accounting → Bank Applications → Loans Management → Position Management → Business Operations → Workplace for Business Operations → Deferral → Create

Enter or change the relevant data and save, then activate or post the business operation.

For more information about using the Workplace for Business Operations see Business Operations .