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1 Copyright © 2016, Oracle and/or its affiliates. All rights reserved. |

Accelerator Pack 12. 4 Payments and Collections 2 Copyright © 2016, Oracle and/or its affiliates. All rights reserved. |

Program Agenda § Introduction § Features § Payments § Collections 3 Copyright © 2016, Oracle and/or its affiliates. All rights reserved. |

Program Agenda § Additional Features of PC § Products § Product Categories to Product Mapping 4 Copyright © 2016, Oracle and/or its affiliates. All rights reserved. |

Introduction: Payments and Collections: § Payments and collections (PC) module of FLEXCUBE helps to process local currency funds transfer transactions initiated either by bank customer through an Electronic Banking System, or by bank staff in any of the branches on behalf of a customer. § The PC module handles the following types of transactions: – Payments – Collections 5 Copyright © 2016, Oracle and/or its affiliates. All rights reserved. |

Introduction: Payments and Collections: § Customer transfer as well as bank transfer are supported. § Both BOOK transfer and external clearing are supported by FLEXCUBE. 6 Copyright © 2016, Oracle and/or its affiliates. All rights reserved. |

Features: Basic features of Payments § Payment transactions are initiated by the debtor who instructs his bank (debtor’s bank) to draw/transfer a certain amount from his (debtor’s) account, to the creditor’s account in the creditor’s bank. It involve the transfer of funds from one’s own account to another account. 7 Copyright © 2016, Oracle and/or its affiliates. All rights reserved. |

Features: Basic features of Collections § Collection transactions are initiated by the creditor who instructs his bank (creditor’s bank) to draw a certain sum from the debtor’s account (in the debtor’s bank). § Here it is assumed that an agreement exists between the debtor and the creditor of the transaction along with an agreement for them in their respective banks. § Collections can be of type: – Request for debit (RFD) – Direct Debit (DD) 8 Copyright © 2016, Oracle and/or its affiliates. All rights reserved. |

Payments: Basic features of Payment transactions § Payment transactions can be of transfer type: – Customer : Payment transactions initiated by the bank on behalf of its customer. – Bank : Payment transactions initiated for the bank purpose. § The clearing mode for a payment transaction can be of type: – Book transfer : When the transfer of funds takes place within the accounts in the same bank and does not involve any clearing network. – External Clearing : When the transfer of funds takes place within accounts in different banks and involves settlement through a clearing network. 9 Copyright © 2016, Oracle and/or its affiliates. All rights reserved. |

Payments: Basic features of Payment transactions § The basic flow of a book transfer type of payment transaction is mentioned below in steps: – The debtor initiates an outgoing payment transaction and instructs the bank to credit another account in the same bank. – On creation of this transaction, the debtor account gets debited with the transaction amount and an offset transaction (incoming payment) is created where the credit to the creditor’s account happens. 10 Copyright © 2016, Oracle and/or its affiliates. All rights reserved. |

Payments: Basic features of Payment transactions § The basic flow of an external clearing type of payment transaction is mentioned below in steps: – The debtor initiates an outgoing payment transaction and instructs the bank to credit another account in another bank. On creation of this transaction, the debtor account gets debited with the transaction amount and the clearing GL will get credited. – The creditor bank receives this transaction as an incoming payment transaction and the creditor account is credited with the transaction amount. 11 Copyright © 2016, Oracle and/or its affiliates. All rights reserved. |

Payments: Basic features of Payment transactions – Payment transactions are normally current dated. – In case the creditor finds any mistake in the received payment transaction, he can reject the same and a reject of incoming payment transaction is created with the reversed accounting entries. – The same is received on the debtor side as reject of outgoing payment and the accounting entries are reversed In the debtor side as well. 12 Copyright © 2016, Oracle and/or its affiliates. All rights reserved. |

Collections: Basic features of RFD type of Collection transactions § The basic flow of a RFD type collection transaction is mentioned below in steps: – The creditor initiates an outgoing collection transaction and instructs the bank to debit another account in another bank. – Here it is assumed that agreement exists between the debtor and the creditor of the transaction as well as with their respective banks. – This transaction is usually future dated and the actual debit and credit happen on the activation date. 13 Copyright © 2016, Oracle and/or its affiliates. All rights reserved. |

Collections: Basic features of RFD type of Collection transactions – Since the transaction is RFD type, the receiver (debtor) of the transaction needs to approve the transaction (incoming collection) based on which the debit to his account will happen and subsequently the credit to the creditor’s account. – The debtor can reject the received transaction before the approval date in case if he doesn’t want to debit his account. In that case, the transaction will be marked as rejected. – If the Incoming collection is not approved with in the response days then the contract would get rejected automatically. 14 Copyright © 2016, Oracle and/or its affiliates. All rights reserved. |

Collections: Basic features of Direct Debit Collection transactions § The basic flow of a DD type of collection transaction is mentioned below in steps: – The creditor initiates an outgoing collection transaction and instructs the bank to debit another account in another bank. – Here it is assumed that agreement exists between the debtor and the creditor of the transaction along with their respective banks. – This transaction is usually future dated and the actual debit and credit happen on the activation date. 15 Copyright © 2016, Oracle and/or its affiliates. All rights reserved. |

Collections: Basic features of Direct Debit Collection and Reject transactions – The debtor receives this transaction as an incoming collection and on the due date, the debtor account is debited and subsequently the creditor account is credited. – If the debtor bank finds any discrepancies, then they can reject the transaction before (pre-settlement reject) on or after the activation date (post-settlement reject) provided it is within the response days. – This reject is received by the creditor bank as reject of outgoing collection and the original outgoing collection transaction is rejected and the accounting entries are reversed (if any). 16 Copyright © 2016, Oracle and/or its affiliates. All rights reserved. |

Collections: Basic features of Direct Debit Collection Reverse transactions – Apart from this, the creditor himself can initiate a reverse of outgoing collection transaction which would be received by the debtor bank as reverse of incoming collection transaction. – The accounting entries for the incoming and outgoing collection transactions will get reversed (if any). – Reversal should be done within the response days. 17 Copyright © 2016, Oracle and/or its affiliates. All rights reserved. |

Collections: Basic features of Direct Debit Collection Recall transactions – At the debtor side, the debtor can also initiate a recall of incoming collection post response days and within the recall days then the same would be received at the creditor side as recall of outgoing collection transaction. – The accounting entries are reversed and here the debtor can claim for an interest amount for the amount that had been debited. 18 Copyright © 2016, Oracle and/or its affiliates. All rights reserved. |

Additional Features of PC: § Some of the additional features provided by PC module in FLEXCUBE are explained below. § These are achieved through the preferences available for the PC product: – Charges: This feature enables the bank to collect charges for the services provided by it to the customer. The charge mode is categorized into: • Premium: The charge and transaction amount are collected exclusively. • Discount: The charge amount is inclusive of the transaction amount. 19 Copyright © 2016, Oracle and/or its affiliates. All rights reserved. |

Additional Features of PC: – Customer entry consolidation: This feature allows the system to consolidate recurrent accounting entries to the customer account so that all the entries are consolidated and is shown as a single debit/credit to the customer account. – Auto reject: This feature enables the system to automatically reject an incoming message that is received based on reject code mapping to the FLEXCUBE error codes. While creating incoming payment or collection contract the system will post accounting entries to the unsettled GL and also book a reject contract with the reverse entries using the reject code derived. – Dispatch accounting: This feature allows the system to post consolidated accounting entries to the clearing NOSTRO account. – Contract split: Using this feature , a given transaction can be split into multiple transactions based on the maximum number of split count. 20 Copyright © 2016, Oracle and/or its affiliates. All rights reserved. |

Additional Features of PC: – Cut-off checks: The cut-off time check feature enables the user to set the cut- off time for a particular clearing network. If transactions are received post cutoff, the activation date for the same is moved to the next working date – P 2 P Contracts: Peer to Peer contract is a feature which will enable to initiate the payment contract with additional information of a beneficiary like Telephone no, Email ID etc. This request would be initiated only from FCDB. – FATCA Tax: FATCA tax would be collected from the beneficiary of contract based on the US indicia and Recalcitrant status. This is applicable for Outgoing, Incoming and Book transfers of payment and DD & RFD types of collection contracts. 21 Copyright © 2016, Oracle and/or its affiliates. All rights reserved. |

Additional Features of PC: – Reject Code Restriction for a Network: Facility to restrict the Reject codes for a network and maintain the same reject codes across many Networks. – Transaction Processing would validate that the reject code specified for the rejection/Recall/Reverse of transaction is valid for specific Network. – Auto reject processing with network specific reject codes: To process Auto reject of errors for multiple networks using network specific reject codes. 22 Copyright © 2016, Oracle and/or its affiliates. All rights reserved. |

Additional Features of PC: The following Schemes are supported in SEPA – SEPA Credit Transfer: A credit transfer is a payment initiated by the payer. The payer sends a payment instruction to his/her payment service provider (PSP). The payer’s PSP moves the funds to the payee’s PSP in SEPA region. – SEPA Direct Debit Core: A direct debit is a transfer initiated by the payee, that is the recipient of a payment, via his/her payment service provider (PSP). – SEPA Direct Debit B 2 B: Business to Business Direct Debits based on the SDD B 2 B Rule book Note: Product setup done for the bank act as Direct Participant excluding COR 1 scheme. 23 Copyright © 2016, Oracle and/or its affiliates. All rights reserved. |

Additional Features of PC: Difference between CORE and B 2 B Scheme: Aspect Core Scheme B 2 B Scheme Refund right of the Debtor for authorized transactions. The Debtor is entitled to obtain a refund. The Debtor is not entitled to obtain a refund. The latest date for the Debtor bank receiving the Collections. A first or one-off Collection must be received by at least five inter-bank business days before Due date (D-5). A subsequent Collections must be received by at least two inter-bank business days before Due date (D-2). Any Collection must be received by at least one inter-bank business days before Due date (D-1). Mandate Data. Debtor Bank is not obliged by the scheme to store the Mandate data. Debtor Bank must store Mandate data as confirmed by the Debtor and to carry out verification of the Mandate for each Collection received. Debtor has to inform Debtor bank on cancellation of the Mandate during the tenure. 24 Copyright © 2016, Oracle and/or its affiliates. All rights reserved. |

Additional Features of PC: Difference between CORE and B 2 B Scheme: Aspect Core Scheme B 2 B Scheme The latest date for the Return of a Collection. Five inter-bank business days (D+5) after the settlement date of the Collection. Two inter-bank business days (D+2) after the settlement date of the Collection. Debtor bank’s obligations to check. For each Collection received, Debtor bank must debit the Debtor’s account if the account status allows. Debtor bank is obliged to obtain a confirmation from the Debtor on B 2 B Mandate received as part of Collection presented before debiting the Debtor’s account. Message Standards. The Scheme identification will be ‘CORE’. The Scheme identification will be ‘B 2 B’. 25 Copyright © 2016, Oracle and/or its affiliates. All rights reserved. |

Additional Features of PC: SEPA Messages Supported § Pain. 002. 001. 03 § Pain. 008. 001. 02 § Pain. 007. 001. 02 § Pacs. 003. 001. 02 § Pacs. 002. 001. 03 § Pacs. 004. 001. 02 § Pacs. 007. 001. 02 § Camt. 056. 001. 01 § CAMT. 029. 001. 01 26 Copyright © 2016, Oracle and/or its affiliates. All rights reserved. |

Products: Payments § OPEX - Outgoing Payment Product – Customer Transfer § OPPB - Outgoing Payment Product – Bank Transfer § IPPC - Incoming Payment Product § JIPC - Reject of incoming payment § JOPC - Reject of outgoing payment § BKOP - Outgoing Payment Product § BKIP - Incoming Payment Product § OEFX - Outgoing External Payment-FX Linkage 27 Copyright © 2016, Oracle and/or its affiliates. All rights reserved. |

Products: Payments § IEFX - Incoming External Payment-FX Linkage § P 2 PC - P 2 P Customer Debit-Outgoing Book Transfer § P 2 PT - P 2 P Test transaction- outgoing External § P 2 PF - P 2 P Final payment- Outgoing External § P 2 RT - P 2 P Test transaction-Reject of Outgoing payment § P 2 RF - P 2 P Final payment-Reject of Outgoing payment § OPFE - Outgoing Payment – FATCA § IPFE - Incoming Payment - FATCA 28 Copyright © 2016, Oracle and/or its affiliates. All rights reserved. |

Products: Collections § ICCD - Incoming collection Product _DD § OCCD- Outgoing Collection Product_DD § ICRC - Incoming collection Product – Request for Debit § OCRC - Outgoing Collection Product – Request for Debit § JIDC - Reject of Incoming collection _DD § JOCD - Reject of outgoing collection _DD § CIDC - Recall of incoming collection_DD 29 Copyright © 2016, Oracle and/or its affiliates. All rights reserved. |

Products: Collections § CODC - Recall of outgoing collection _DD § VIDC - Reversal of incoming collection_DD § VODC - Reversal of outgoing collection _DD § OCFT - Outgoing Collection DD – FATCA § ICDF - Incoming collection DD – FATCA § ICFT - Incoming Collection RFD - FATCA 30 Copyright © 2016, Oracle and/or its affiliates. All rights reserved. |

Products: SEPA Credit Transfer § SOPC - Outgoing Payment Product § SIPC - Incoming Payment Product § SIXC - Reject of incoming payment § SOXC - Reject of outgoing payment 31 Copyright © 2016, Oracle and/or its affiliates. All rights reserved. |

Products: SEPA Direct Debit -CORE § DICC - Incoming collection product § DOCC- Outgoing collection product § DIXC - Reject of incoming collection § DOXC - Reject of outgoing collection § DIRC - Recall of incoming collection § DORC - Recall of outgoing collection § DIVC - Reversal of incoming collection § DOVC - Reversal of outgoing collection 32 Copyright © 2016, Oracle and/or its affiliates. All rights reserved. |

Products: SEPA Direct Debit –B 2 B § DICB - Incoming collection product § DOCB- Outgoing collection product § DIXB - Reject of incoming collection § DOXB - Reject of outgoing collection § DIRB - Recall of incoming collection § DORB - Recall of outgoing collection § DIVB - Reversal of incoming collection § DOVB - Reversal of outgoing collection 33 Copyright © 2016, Oracle and/or its affiliates. All rights reserved. |

Product Categories to Product Mapping: Payments: 34 Product Category Description Products OUPA Outgoing Payment BKOP, OPEX OPRJ Reject of Outgoing Payment JOPC INPA Incoming Payment BKIP, IPPC INPR Reject of Incoming Payment JIPC OPBT Outgoing Payment Bank Transfer OPPB OPFX Outgoing External Payment-FX Linkage OEFX Copyright © 2016, Oracle and/or its affiliates. All rights reserved. |

Product Categories to Product Mapping: Payments: 35 Product Category Description Products IPFX Incoming External Payment-FX Linkage IEFX FCOP Outgoing Product - FATCA OPFE FCIP Incoming Product - FATCA IPFE POUP Outgoing Payment-P 2 PC, P 2 PT PFOU Outgoing Payment-P 2 P FINAL P 2 PF PORJ Reject Of Outgoing Payment-P 2 P P 2 RT, P 2 RF Copyright © 2016, Oracle and/or its affiliates. All rights reserved. |

Product Categories to Product Mapping: Collection: 36 Product Category Description Product OUCL Outgoing Collection OCCD INCO Incoming Collection ICCD OURJ Reject of Outgoing Collection JOCD INRJ Reject of Incoming Collection JIDC OURV Reverse of Outgoing Collection VODC INRV Reverse of Incoming Collection VIDC Copyright © 2016, Oracle and/or its affiliates. All rights reserved. |

Product Categories to Product Mapping: Collection: 37 Product Category Description Product OURC Recall of Outgoing Collection CODC INRC Recall of Incoming Collection CIDC ICCR Incoming Collection -RFD ICRC OCCR Outgoing Collection – RFD OCRC XOCR Outgoing Collection Reject - RFD JORC XICR Incoming Collection Reject - RFD JIRC Copyright © 2016, Oracle and/or its affiliates. All rights reserved. |

Product Categories to Product Mapping: Collection: 38 Product Category Description Product OURV Reverse of Outgoing Collection VODC INRV Reverse of Incoming Collection VIDC OURC Recall of Outgoing Collection CODC INRC Recall of Incoming Collection CIDC ICCR Incoming Collection -RFD ICRC OCCR Outgoing Collection – RFD OCRC Copyright © 2016, Oracle and/or its affiliates. All rights reserved. |

Product Categories to Product Mapping: Collection: 39 Product Category Description Product FCOC Outgoing Collection DD - FATCA OCFT FCIC Incoming Collection DD – FATCA ICDF FCIR Incoming Collection RFD – FATCA ICFT Copyright © 2016, Oracle and/or its affiliates. All rights reserved. |

Product Categories to Product Mapping: SEPA Credit Transfer 40 Product Category Description Product CIPC SEPA Incoming Payment SIPC CIXC SEPA Incoming Payment Reject SIXC COPC SEPA Outgoing Payment SOPC COXC SEPA Outgoing Payment Reject SOXC Copyright © 2016, Oracle and/or its affiliates. All rights reserved. |

Product Categories to Product Mapping: SEPA Direct Debit -CORE 41 Product Category Description Product EICC SEPA Incoming Collection -CORE DICC EIRC SEPA Incoming Collection Recall - CORE DIRC EIXC SEPA Incoming Collection Reject - CORE DIXC EOCC SEPA Outgoing Collection - CORE DOCC EORC SEPA Outgoing Collection Recall - CORE DORC EOXC SEPA Outgoing Collection Reject - CORE DOXC EIVC SEPA Incoming Collection Reverse - CORE DIVC EOVC SEPA Outgoing Collection Reverse- CORE DOVC Copyright © 2016, Oracle and/or its affiliates. All rights reserved. |

Product Categories to Product Mapping: SEPA Direct Debit -B 2 B 42 Product Category Description Product EICB SEPA Incoming Collection –B 2 B DICB EIRB SEPA Incoming Collection Recall – B 2 B DIRB EIXB SEPA Incoming Collection Reject - B 2 B DIXB EOCB SEPA Outgoing Collection - B 2 B DOCB EORB SEPA Outgoing Collection Recall - B 2 B DORB EOXB SEPA Outgoing Collection Reject - B 2 B DOXB EIVB SEPA Incoming Collection Reverse - B 2 B DIVB EOVB SEPA Outgoing Collection Reverse- B 2 B DOVB Copyright © 2016, Oracle and/or its affiliates. All rights reserved. |

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