[jira] [Commented] (FINERACT-1307) Loan Ideal disbursement to calculation cause to wrong interest rate

["bharath gowda (Jira)" <ji...@apache.org>]

    [ https://issues.apache.org/jira/browse/FINERACT-1307?page=com.atlassian.jira.plugin.system.issuetabpanels:comment-tabpanel&focusedCommentId=17277049#comment-17277049 ] 

bharath gowda commented on FINERACT-1307:
-----------------------------------------

Hi Eitan,

Could you provide us the Loan product configuration for the example you have provided.

 

Ideally, if you need the interest to be changed for only the days between the Disbursement date and First Repayment Date,
 # you will have to first enable the configuration "interest-charged-from-date-same-as-disbursal-date "
 # check the loan production configuration parameter "Interest calculation period" if it is set to "Daily" then no issues, but if it is set to "same as repayment" then you have to check the checker box "Calculate interest for exact days in partial period "

Hope this helps, check and revert if you need any more details

Below is the example

!image-2021-02-02-16-43-07-381.png!

 

> Loan Ideal disbursement to calculation cause to wrong interest rate 
> --------------------------------------------------------------------
>
>                 Key: FINERACT-1307
>                 URL: https://issues.apache.org/jira/browse/FINERACT-1307
>             Project: Apache Fineract
>          Issue Type: Bug
>          Components: Loan
>            Reporter: eitan frailich
>            Priority: Minor
>         Attachments: image-2021-02-02-16-43-07-381.png
>
>
> *ISSUE*
> My issue/bug happens when I am setting "First repayment on" field I get a repayment schedule with a wrong interest rate for the first installment.
> Example: When I set "First repayment on" to 01/02/21 and expected disbursement is 27/1/21(Frist image) then I get the wrong interest.The first installment interest is 21,232.88$ (second Image) - calculated for the entire month (31 days) instead of 5 days (the time from the disbursement to the first repayment), the right interest should be 3424.75$.
> *After debugging:*
> In AbstractLoanScheduleGenerator there is a function {{calculateInterestStartDateForPeriod}} - it uses the {{idealDisbursment}} for setting the interest start date for the first installment, The {{idealDisbursment}} is calculated by {{idealDisbursementDateBasedOnFirstRepaymentDate}} which does [{{firstRepaymentDate}} - 1 repayment Period Frequency] aka, for 01/02/21 with months as repyment frequency it will return 01/01/21.
> So when we dont set the "First repayment on" the {{idealDisbursment}} will be the expected disbursement date because the first repayment is always {{expectedDisbursment}}+1. But if we set the  "First repayment on" we get the wrong value for the {{idealDisbursment}} - in my example we got 01/0/21 and this is why the first installment interest was calculated for an entire month instead of  5 days.
> *Is it a bug or not?*
> I am not sure why {{idealDisbursementDateBasedOnFirstRepaymentDate}} exists, the simple solution is to do  idealDisbursment=expectedDisbursmentDate.I tried it locally and looks like it works, I will be happy to make a PR, but want to make sure indeed that the {{idealDisbursementDateBasedOnFirstRepaymentDate}} is redundant.



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