Hi Ryan,
How are you doing? This is what we just planned for SECDEP.
They have two insurance products.
MMF1 - Compulsory Credit Life Insurance - In-house
MMF2 - Voluntary Death, Hospitalization, Accident - Third Party
Both insurance products are set-up as client charges since they will be
collected weekly whether the client has an outstanding loan or not.
Both insurance products will be assigned "Liability" GL codes since
these funds should eventually be returned to the client (MMF1) or
remitted to the third-party insurance (MMF2).
For MMF2, claims will be processed and recorded centrally (head office)
outside Mifos.
For MMF1, when a client dies, the client gets two benefits:
1) Cash based on client's # of years with SECDEP
2) Payment of last loan's outstanding balance
For #1. Head Office accounting will credit MMF1 fund and give the check
to the branch. No Mifos recording.
For #2.
1) Head office accounting will credit MMF1 fund in the amount of
the outstanding loan balance.
2) Head office accounting will issue an advice notice to the
branch MIS encoder to pay to loan balance.
3) MIS encoder will do the following in Mifos.
a. Pay-off the loan.
b. Change the client status to Close. Maybe note "Due to
Death".
I know this does not necessarily address all your concerns below but I
think "write-off" is a misnomer in this case since the loan is
fully-paid. It is actually not good to use the "write-off" function
because write-offs are recorded as expense in accounting whereas the
payment is cash received.
So, I am sitting write next to you. So, we can discuss this if you want.
;)
-Marie
-----Original Message-----
From: Ryan Whitney [mailto:[email protected]]
Sent: Saturday, March 21, 2009 2:45 PM
To: [email protected]
Subject: [Mifos-users] How to handle client death
Hello all,
I'm trying to figure out how to model the current scenario properly in
Mifos.
* Client has a loan insurance policy with the MFI and on every meeting,
makes a payment as a premium
* Client is in the middle of a loan and dies suddenly
* The MFI takes the amount already paid and returns that to the client's
beneficiary and then takes from the insurance to pay off the loan and
write
it off.
I'm not entirely sure how to track this in Mifos. For one, the MFI is
writing off the loan, but in Mifos we can only write off if the loan
hasn't
been completely paid. If we pay the loan off, then its marked as
"Closed -
Obligations" met.
Only way I can think of currently is
1. Reverse the loan and add in comment that it was due to client death
2. Redo loan and then pay off in one lump sum.
Or maybe use the status change with "Closed - Rescheduled" ?
Thoughts? Anyone have a good workaround for this?
Ryan
--
Ryan Whitney
Mifos Technical Program Manager
[email protected]
Mifos - Technology that Empowers Microfinance (www.mifos.org)
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powering Web 2.0 with engaging, cross-platform capabilities. Quickly and
easily build your RIAs with Flex Builder, the Eclipse(TM)based development
software that enables intelligent coding and step-through debugging.
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