Instalments

PayCredit supports the conversion of eligible transactions into an instalment loan. Instalment loans enable customers to spread the cost of a transaction over a defined repayment schedule.

The instalment loan is linked to the customer’s revolving credit account and repayments made to the account will also repay the instalment loan.

Key elements of instalments include:

• Transaction criteria: only transactions matching criteria such as spend type are eligible for an instalment loan. Transaction criteria also links to finance options.
• Finance options: clients can define a number of options for loan duration (tenure), interest and fees.
• Instalment illustrations: for eligible transactions customers can view loan illustrations including monthly instalment amount and total fees and/or interest.
• Instalment loan creation: a customer selects an illustration to convert a transaction to an instalment loan. PayCredit then reassesses eligibility and creates the instalment loan.
• Repayment schedule: upon creation, the instalment loan generates a series of instalment repayments and manages the instalments including tracking monthly repayments through to completion of the loan.
• Cancellation, termination and fees: an instalment loan can be cancelled at any time, whereas termination occurs when a defined number of repayment cycles become overdue.

Example customer experience

Below is an example use case:

1. Customer makes transaction which is eligible for an instalment loan.
   1. PayCredit detects and records the eligible transaction.
2. Customer selects to view instalment illustration(s).
   1. Depending on finance options, the customer might be presented with multiple illustrations.
   2. Illustrations will show monthly amounts, interest and/or fees, tenure.
   3. All illustrations are stored in the PayCredit system.
3. Customer can select one instalment illustration and trigger conversion of transaction to an instalment loan.
   1. Transaction amount is credited in the revolving credit account and added to a new instalment loan account.
   2. The instalment loan includes repayment schedule of amounts due.
4. The next customer statement includes minimum repayment due for revolving credit account plus the monthly instalment amount due.
5. When customer makes repayments, amounts are allocated to repay the instalment amount due and then repayment to the revolving credit account.
   1. The customer just makes repayments as usual to their account and PayCredit takes care of allocating amounts to both revolving account and the instalment.
6. Customer can view status of instalment loan and outstanding amounts due.
7. Customer can opt to cancel instalment, which may trigger a fee if configured by the client.
8. If a customer does not make minimum repayments, then if configured, the instalment loan will be terminated and a fee applied to the revolving account.
9. Cancellation or termination results in unpaid amounts being transferred back to the revolving credit account.