Skip to Content
avatar image
Former Member

Effective Interest rate for Loans

Hi all,

I've maintained IT0045, and under conditions tab I've maintained "5% monthly interest and rate". but after running payroll, 5.1239% is coming as "Effective Interest rate" under same condition tab. How this interest rate is calculated and where is it being used, please advise.

Tomesh

Add comment
10|10000 characters needed characters exceeded

  • Get RSS Feed

2 Answers

  • avatar image
    Former Member
    Aug 16, 2007 at 10:20 AM

    It depends upon the interval of the repayment and the start date of repayment.

    Assuming if the loan is offered on january and interest starts from march then the left over periods january and february interest rate is calculated and added to the interest rate.

    Add comment
    10|10000 characters needed characters exceeded

    • Former Member

      HI KK,

      Thanks for reply.

      But in my case the loan is offered and the interest starts on the same month.

      So I think that may not be the case.

      Regards,

      Tomesh

  • avatar image
    Former Member
    Aug 17, 2007 at 08:33 AM

    Hi Tomesh

    follow the following steps:

    Payroll India:

    company Loan

    1. Maintain Loan types -

    2. create subtype

    3. assign contry assignment/ attributes

    and Condition ( Interest Rates) here u have assign the Interest rates

    -


    PA30

    infotype 0045

    basic data:

    enter Loan amount

    Conditions:

    enter Rate

    repayment start date

    repayment Amount ( monthly)

    Payments:

    enter first instalment date

    payment type ( loan payment external)

    enter 3 times

    ( By default system calculate rest of the calculation)

    u will get enter loan repayment details

    Best Wishes

    Vellore Sekar

    Add comment
    10|10000 characters needed characters exceeded