OPENING OF LOAN ACCOUNT

Loan account in CBS is opened in the same way as the other accounts are opened
through menu option OAAC and to be verified through OAACAU.
The details which are captured through OAAC are as under:
G. General Detail
S. Scheme Detail
V. MIS Detail
H. Limit Detail
I. Interest Detail
E. Repayment Schedule.
Apart from the above, in case there is guarantor in the account than Guarantors details
through A. Detail i.e. Related party details are to be captured. Also in case the loan
amount is to be disbursed in phases then D detail, i.e. Disbursement Schedule is also to
be captured.
Here it is needless to be mentioned that while opening the account Customer id of the
account holder and Scheme code under which the account is to be opened are also to
be entered.
The moment OAAC menu option is executed the system asks for Customer id and
Scheme code under which the account is to be opened is to be entered followed by
pressing of key F4.
The system will take the user to the G detail i.e. General Detail where some of the fields
are duly filled in. The system has picked up these detail either from the customer
master or from scheme code.
The General detail screen is shown below:
Name of the account, short name fields are duly filled in by the system. User has to
enter Mode of Operation. See the value and select appropriate one.
Account Manager: This is the employee id of the user who is the manager of the
account. That means who is looking after opening of accounts of that particular group.
Normally this field may be used by the MCB and LC Braches.

Location Code: Enter the location. User can press F2 and see the list and select the
same.
Special Charge Code: Not to be entered.
On this page rest are the fields are duly filled in.

In the field App. Ref. ID, Lead Number generated out of CRM package is to be entered
(if applicable) in order to establish the compatibility of Finacle with CRM, in case it is
required in future.
Remarks Press F2 and select appropriate code by pressing Shift+F4

Press F6 to go on to the next page, which has been shown below:

Passbook/Statement? If it is not default populated then enter S for Statement of

account and Frequency M for Monthly, leave next two fields blank, in the second last
field the last day of the month i.e. 31 and in the last field enter N for next day. Press F4.
Next select Interest Rate Code from the list.
Int. Rate Code (Mandatory) By default, the Cursor will appear at the Interest Rate Code
Field. Type first 2 characters of the loan segment e.g for Car loans type CA or for Two wheeler,
type TW(Refer ITD CBS Circular No- 65/2013 for List of help flag for interest table codes.)
For selection of appropriate Interest Table Code user should enter the Help Code first and then
press F2, system will display all interest table codes related to help flag on the top of the list and
remaining interest table codes will be listed thereafter.
a. Select appropriate interest table code by pressing Shift + F4
b. After selecting proper Int. Rate Code, Press F4. System shall validate values
entered in the fields, as also it shall check that valid values are entered in
mandatory fields and then the cursor shall appear in Option Code field.

If there is any difference in interest rate then enter the difference in Account
Preferential Dr. field and press F4. The cursor will appear on the option field.
If loan has been sanctioned on or after 01-04-2016 and interest is to be charged as per
MCLR guideline:
A/c Pegged? It should be 'Y'. (As per MCLR guideline ROI of an a/c does not change
upto next Reset Date (i.e. Review Date))

Pegging Frequency(Mnths/Days) The duration (Currently it is 12 month as per IRMD

guideline on Reset Period) after which ROI will change as per Intt Table Code fed in the
a/c.

SCHEME DETAILS SUB OPTION S (2 SCREENS ) - MANDATORY

1. Loan amount is the amount of loan sanctioned.
2. Loan period is the tenor of the loan. The system validates for this value also
based on the scheme level set up and appropriate exception would be raised if the
loan period exceeds the maximum as per scheme.
3. Hold in operative account If the value is set as Y for the field Hold In Oper A/c
For Amount Due? then Operative account number of the customer has to be filled
in where from the instalment amount is to be recovered.
4. Repayment Method Value set for the field Repayment Method will decide how
repayment will be made. If the value is set as
E, then system recovers what is available in the operative account.
T system creates a TOD and recovers the entire dues from the operative account
by granting temporary overdraft in the operative account.
N then no recovery would be done.
P Post dated cheques or
D Electronic clearing, then the user can get a report on such accounts and all
further processes is procedural
the user can run LALIEN menu in the morning by which system marks lien on the
operative account to the extent of demand in the loan account and at the time of the
day end a batch job has been set by the Data Centre for running the menu option
LADSP due to which the system automatically generates the transaction debiting the
operative account of the customer and crediting loan account.
Operative A/c ID:- Enter the operative account no maintained with the Branch/
Bank.
Debt Acknowledgement Date is the date of BC letter obtained from the customer
from which the limitation period in the account will start. In new account the date of
documents can be entered.
Value of Asset: Enter the value of assets being purchased.
Priority Loan Enter Y if the account belongs to priority sector.
Transfer in Account if the value is set as Y for field Transfer in A/c, then the
user has to enter additional information in sub option U uncomputerised
details.Fields on the 2nd Screen relate to various information relating to the account

with regard to Refinance, Subsidy etc. No validations are done based on any of
those fields.
Debit Int To In case of simple interest bearing loan accounts this should be O the
system will debit Office account and in all other cases this is to be L- that means the
interest shall be debited to Loan account hence it will be compound interest bearing
loan account.
Valuation required to be entered only in case the old assets are being purchased
then only the valuation is to be done.
Press F4, the cursor will appear on the option field enter V for MIS detail and
again press F4. The following screen will appear. Here you have to enter the
desired MIS detail. User can press F2 and then select from the list available on
each field. But this should be correct. MIS code free text from 3 to 7 are very
important and in free text 10 also user has to select the activity code for which the
loan is being given. The screen is shown as shown on the next page.

Press F6 to go on to next page.

On the next page user has to enter

I.
II.
III.
IV.

Free Text1: PNB Score ID for Retail Loan.

Free Text2: Monthly income of the borrower.
Free Text4: If loan has been sanctioned by RAPC, then enter the sol-id
of RAPC else branch sol-id.
Free Text6: PNB SME Score ID of borrower.

Enter H in the option field to go to the Limit Details.

LIMIT DETAILS:
Sanction Date: Enter date of loan sanctioned.
Expiry Date: This is the date on which the loan will expire, that means on which
date there should be no outstanding remain in the account.

Penal Int. From: Basically this the date on which the system should start levying
penal interest in the account on account outstanding remaining after the expiry
period.
Document Date: Enter date on which documents have been executed.
Review Date: Enter date prior to expiry date on which the account should be
reviewed.
Sanction Level: Where the loan has been sanctioned i.e. Branch, Circle Office,
Head Office etc.
Sanctioning Authority: Enter who has sanctioned the loan. Here the user can
press F2 and select from the list.
Sanction Ref #Enter Sanctioning authorities and Recommending Authoritys PF
number in 7 digits inserting / in between.
Security Description: Enter the security offered in the account.
Remarks: Enter remarks if any. Press F4
After completing above the cursor will move on the next page of the limit
details as shown below:

Here enter the Drawing Power Indicator. In Term Loan and Demand Loan normally
DP indicator is to be entered as E i.e. DP in this account will be equal to the Limit
Sanctioned which will be Loan amount.
Limit ID: Enter Limit id taken out of Limit Node in case if the same has been
prepared. Press F4 the cursor will appear at option field.
Enter I for Interest Detail which has been shown below:

Here most of the fields are populated as per scheme and are protected also. User
has to enter the Interest Demand Effective Date. This date shall be the date on
which the system should raise demand for interest. If it is left blank then system will
raise interest demand on the same day of interest application in the account. If it is
future date then system will raise interest demand for future date till the date is
arrived thereafter on interest application date.
For scheme codes TLSHL, TLSVL this date should be the date on which repayment
of interest starts. For scheme code TLRED, TLPED this date should be Repayment
Start date of loan.
In case of equated installment schemes (EIDEM), this date should not be greater
than the repayment start date (flow start date of E detail).
Press F4, the cursor will appear at Option field. Enter E for Repayment Schedule
and press F4. The cursor will appear at repayment schedule screen shown as
follows:

The cursor will blink on the repayment flow id of the account. In case the flow id is
EIDEM then it is a compound interest bearing loan account. User has to define the
number of instalment in which the loan is to be repaid. In Start date enter date from
which the repayment of instalments will begin. Whether the instalment shall be
monthly, quarterly, half yearly or yearly, it is to be entered in the next field i.e. the
flow frequency. Then leaving next two fields vacant enter the last day of the month
on which the instalment will become due. In case the last day happens to be the
holiday, user has to enter P (for previous day) in the next field.
Flow Amount:
system.

this is the instalment amount which shall be calculated by the

Int Dmd Date: this is the date on which the system will apply the interest in the
account.
Int. Freq: Enter frequency of interest application in the account. Whether interest
shall be applied M for monthly, Q for quarterly, H for half y early or Y for yearly.
Enter last day of the current month leaving next two fields blank and P for previous
day in the last field of Int. Freq. in case the last day of the month happens to be
holiday. Press F4 the cursor will appear at the option field. Press F10 to complete
the account opening.
Note down the account number and verify the account.
Make the disbursement through TM and issue the draft in favour of vendor.
Create SRM as defined in Cash Credit account opening chapter. But enter the

account opening date in Received Date field and in Due date field enter last
instalment repayment date adding thereto one month. Here also the SRM is to be
verified.
Handling Concept of Minimum Rate of Interest in Loan & Advances in CBS (CBS 4/16)
(As per HO: IRMD L&A Cir. No. 85/2015 dated 30-09-2015)
whereby reduction in Base Rate & concept of Minimum Rate of Interest were circulated as
under:Minimum rate of interest shall remain applicable in respect of cases, sanctioned at
concessional/ negotiated rates where the sanctioned rate of interest is less than the card
rate. In all such cases reduction in Base Rate will not have any effect on the applicable
interest rate, the rate permitted by sanctioning authority shall remain the minimum rate and
shall be continued till the period of concession allowed
To handle such accounts in CBS system, where reduction in base rate is not to be passed
to the borrowers in terms of sanction, branch user is required to feed fix numeric value
(Minimum ROI to be charged in the account) in Dr % Min column during Account
Opening or Minimum Int Dr Column during INTTM modification process. Screen shot
of same is as below:During Account Opening Process:-

During INTTM modification Process :-


The Applicable ROI in the a/c depends on Intt Table Code + A/c Preferential Dr + Customer
Preferential Dr column fed in the loan a/c. If Dr Min% is entered in the account then
system will charge interest in the account @Applicable ROI or @Dr Min %, whichever
is higher.
Upward/ downward change of Base Rate will have the following scenarios:
If Applicable ROI is Less than Dr Min% :- Then System will charge interest @ Dr Min%.
if Applicable ROI is Greater than Dr Min% :-System will charge interest @Applicable
ROI.
Branch user is required to assign appropriate fix numeric value in Minimum Int (Dr.) in all
such accounts which are sanctioned at concessional/ negotiated rates where the
sanctioned rate of interest is less than the card rate and reduction in Base Rate is not to be
passed to the borrowers in terms of sanction.

All concerned are advised to ensure meticulous compliance of the

aforesaid guidelines and all terms and conditions prescribed in IRMD
L&A cir 85/2015 dated 30-09-2015.