What: A possibility to change the Repayment Day on existing and active Installment Loan accounts (Dynamic Term Loan). For example, if an account was created with payments due on every 10th of the month, it would be possible to adjust the account terms and change the monthly repayment day at any point in time to, let's say to 25th of a month.
This should be possible regardless if the Product Setup uses "Fixed Days of Month" method or if the repayment due dates are derived from the First Repayment Due Date using the "Interval" method.
As a result:
the total payment amount of the installment when the change is made should be increased/ deceased, depending on the change in the days of interest calculations
next installments' total payment amount should remain the same, i.e. as per the "original" calculations at the loan account origination
Example: if current (next expected installment) due date is 10th and on the 3rd a customer requests a change of the due date to 25th, then the installment amount being moved from 10th to 25th should increase by the additional 15 days of interest. The future installments amount should not change, however.
This should be possible via API as well.
Why: In order to manage use cases when the clients can change their preferred payment due dates during the life of an active account. For example: customer changed employment, is now paid on a different date.
This is especially important with longer schedules for the following reasons:
all the future installment due dates would be changed automatically, instead of having to edit e.g. 50 remaining installments manually/ via API one by one by indicating their new due dates
with the proposed recalculations, it's easier to explain to clients that as a result of their request they need to pay more in a given longer installment, rather than keeping the payment amount the same and increasing the last installment (which might not be due for the next XX months)
This would also prevent the “negative principal” which is currently returned if the interest amount for a given installment is higher than the initially calculated payment amount (e.g. result from postponing the due date by 1-2 months).