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Enabling Flexible Payment Options

Learn how the XYB platform supports flexible repayment strategies including partial repayments, early repayments, and extra payments, and how to configure them in your product setup.

Flexible payment options allow customers to manage their credit more efficiently by paying off debt ahead of schedule or in varying amounts. These options include:

  • Partial Payback

  • Early Repayment (Full Payoff)

  • Extra Payment

Each option triggers different logic in the product engine and requires certain configurations in the product setup.

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1. Partial Payback

A partial payback is when a customer pays more than the scheduled amount, but less than the total outstanding balance.

To initiate partial payback, follow the steps below:

  1. Verify product configuration settings:

    1. If TERM_REDUCTION_METHOD is configured under Schedule Calculation Method in product configuration, the system shortens the contract term while keeping the monthly installment amount unchanged.

    2. If INSTALLMENT_METHOD is used instead, the monthly installment is reduced, and the contract term remains the same.

  2. Add new term: Now add a new term in the contract and select Partial Payback from the dropdown. Note: If you're working with a revolving credit line product (e.g., Nordic Revolving Credit), you must select a specific subcontract, as each drawdown has its own repayment schedule.

  1. Select a reason, input the Early payment amount, and (for revolving products) select the relevant subcontract.

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Customer experience:

  • Customers can reduce their loan duration or monthly burden depending on the repayment model.

  • No changes are needed on their end, the system applies the logic automatically.

  • For revolving credit lines, customers may choose which specific drawdown (subcontract) to apply the early payment to.

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2. Early Repayment (Full Payoff)

The full outstanding balance is repaid before the scheduled end date, either due to customer request, contractual changes, or other operational or financial reasons.

To execute this:

  1. Review the Product Configuration settings:

    • Optional: Configure any early repayment fee settings under CONTRACT_EARLY_PAID_BACK fee type if applicable.

    • Ensure your contract supports early settlement behavior.

  2. Create a New Term: In the applicable contract page, create a new term with Change Type: Full Payback .

  • Enter the full outstanding amount (principal + accrued interest + any fees).

  • The term applies to the main contract or the relevant subcontract.

  • Choose from predefined reasons like Contract Full Payback or Borrower Request.

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Customer experience:

  • Customers can fully settle their loan ahead of schedule.

  • Once processed, the system closes the contract automatically.

  • Can be initiated via customer support or self-service UI/API if enabled.

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3. Overpayment (Automatic Partial Payback)

If a customer’s wallet or credit account contains more funds than required before the due date, the system processes a repayment automatically.

To configure this:

  1. Review Product Configuration settings: Ensure Contract Settlement Order Method is configured (e.g., FIFO or LIFO). Determine how excess funds are applied: to invoices first, then to principal.

  2. No changes in contract required: Overpayments are detected by the system without user action.

    Applies any excess to open invoices first, then to principal repayment on the oldest active subcontract

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Customer Experience:

  • No action required, the system applies any overfunding automatically.

  • Reduces the outstanding principal earlier than planned, lowering interest accrual.

  • Invoices and balances adjust accordingly in real-time.

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4. Extra Payout

The customer receives additional funds from their available revolving credit line, this is considered a new drawdown.

To configure this:

  1. Review the Product Configuration: Confirm Subcontract Amortization Period is set, defines the repayment schedule for new payouts. Ensure that credit limit logic and validation rules are correctly defined.

  2. Create a New Term with change Type: Extra Payout. Enter the payout amount and repayment schedule. The system will automatically create a new subcontract for this payout.

  3. Select a Reason: Choose a reason such as Borrower Request, Contract Renewal, or Operational Efficiency.

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Customer Experience:

  • Customers can access additional credit from their existing loan agreement.

  • A new repayment schedule is created for the new drawdown.

  • Payments for each subcontract are tracked independently if configured.

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Summary

Flexible payment options provide powerful tools for customer retention and repayment efficiency. With the right configurations in the XYB product engine, you can support multiple repayment behaviors automatically while giving customers the freedom to manage their credit responsibly.

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