Company Loan Infotype

[swapnil_takte]

Dear Experts,

I have a query on company loan IT0045 I have configured all the IMG setting for the same and durring maintaining this infotype for one test case I got some confusion as like

1. In the IT 0045 in Conditions Tab i found there are two interest rate filds like Indiv. interest rate and Efective interest rate. in this first filed is open for maintaining but another field is blocked. when I have run my payroll after maintaing this I checked this Infotype and I found in the Effective Interest rate their some value appeared automatically. I don't know how it comes. but I want to know it,

So my query is what is the Effective interest rate and what is the difference between Indv. interest rate and Effective Interst rate.

Thanks in Advance

Regards

Swapnil

[swapnil_takte]

Thax

[former_member266380]

Hi Swapnil,

Effective Interest rate depends upon the interval of the repayment and the start date of repayment.

For example, 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.

Check Loans->Maintain Loan types->Select Loan type->Conditions->Select condition

Select Period parameter=> Check interest cycle - First Period in a year and Interval

Hope this gives you clear information of how Effective interest is computes and what is the difference between interest rate and effective :).

Best Regards,

Venkat.