From the moment you create a new loan account in Mambu, the new loan will go through a cycle with different states, each of them with specific implications that we describe next.
For a better understanding of the loan cycle, have a look at the diagram included here (click on it to enlarge).

When you create a new loan account it will be automatically set to the state "Pending Approval".

For all the examples we give next, the underlying assumption is that the roles mentioned (e.g. credit officer) have the right permissions to perform each of the actions.

Accounts Pending Approval

This means that the application will now have to be evaluated by the branch manager who can then choose to approve, reject, ask for more information if something is still missing, or the application can be withdrawn by the client.
In this state it is still possible to edit the loan account terms, so you can change the interest rates or repayment schedule, for example.

After evaluating the application the branch manager might conclude that the information collected is not enough to make a decision on the approval or rejection of the loan application.
In that case, he would change the state of the account to "Partial Application".

Partial Applications

To change an account state to a "Partial Application", choose the option "Set incomplete", add any comments you might have and change the account state.

These comments can be related to the missing information, so that the credit officer can read it and know exactly what he still needs to add.

Requesting Approval for Partial Applications:

As soon as the application is complete the loan officer with permissions to do it, can set the loan account to "pending approval" state so that the branch manager can re-evaluate it.
To do this choose "request approval" from the options and confirm the change.

Rejecting:

A branch manager or someone in the organization with permissions to do it can also reject an application that is incomplete.
In that case the account will be automatically closed and classified in Mambu as "Closed (rejected)".
Closed accounts can't be edited anymore.

They will remain associated to the client or group who requested the loan and keep all the information that was entered, like comments or notes, allowing you to keep track of the reasons for the rejection.
This information can be used later, in case the client makes a new request and you want to consider it for the new evaluation process.

Withdrawing:

If the client chooses to withdraw the loan application, it will be automatically closed in Mambu, and classified as "Closed (withdrawn)".
After this point it won't be possible to perform any transactions or reopen this account.

Approved Accounts

After both the loan amount and repayment schedule have been approved by the branch manager or someone with permissions to do it, the loan application can be approved.
To approve a loan account, choose "Approve", add any comments you might have and confirm the state.

 After being approved, neither the loan terms or the interest amount can be edited anymore.

Withdrawing:

It is still possible to withdraw the application after it has been approved. 
This is the last state where it is still possible to do this, before the loan is disbursed.

Disbursing:

As soon as the application is approved, it's ready to be disbursed.
The disbursement can be done by the credit officer or a staff member assigned with that task.
After being disbursed the loan account becomes automatically Active, and you can now enter any transactions.

Active

This is the state of an account immediately after being disbursed.
It will remain in good standing as long as all the repayments due are made on time.

All Repayments Made

When the client finishes repaying all the installments, Mambu will automatically close the account and set its state to "Closed (all obligations met)".

Write-off

If your organization determines that a loan won't be repaid, it should be closed and written off.
To write off a loan account choose "Close" and "Write off". You can then add any notes you wish to this transaction.
These notes will only be stored with the history of transactions for this account.

Reschedule

When a client is having problems repaying a loan, and to prevent default, your organization might determine that the best option is to reschedule it.
To reschedule a loan, choose "Close" and "Reschedule", add notes about the reasons for rescheduling and confirm the new state.

When you reschedule a loan, the current loan will be closed and its status will change to "Closed - rescheduled", which means you will need to create a new loan account for that client. Those two accounts won't be linked in Mambu, and for reporting issues, the rescheduled loan won't count as part of your organization's loan cycle.

Late Repayments

When a loan account has at least one late repayment, Mambu will automatically change its state to "Active in Arrears" until all the repayments are made.

Active (In Arrears)

Mambu will show you the late repayments of an account in arrears in red and provide you the option of moving the balance to the following repayment, to the last repayment or to add a new repayment to the end of the schedule.

After a certain time with late repayments, and in case your organization determines that the client won't be able to make the repayments, you may choose to Write Off the loan.

Write off

To write off an account in arrears, choose "Close" and "Write-off", add your notes about the reasons for writing off the account and confirm the new state.
As mentioned before, these notes will be stored with the account's history of transactions so that your organization can keep track of the reasons for that decision.

Reschedule

To reschedule an account in arrears, choose "Close" and "Reschedule", add your notes and save the state.

Client repays late payments

As soon as the late repayments are entered, Mambu automatically changes the account state to "Active" again.

All repayments made

When a client who had late repayments is able to pay all of them, the loan account will be automatically closed and Mambu will update its state to "Closed (with obligations met)".

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Related Items

• Creating and Editing a Loan Account
• Creating New Loan Products
• Interest Calculation Methods in Loans
• Managing Fees in Loans
• Managing Loan Products
• Mambu Terminology