Half Monthly

Goal

Introduce support for Half-Monthly (Semi-Monthly) repayment schedules in Apache Fineract, allowing repayments to occur twice every month on predefined dates.

Currently, Apache Fineract supports repayment frequencies such as:

• Daily

• Weekly

• Bi-Weekly (every 2 weeks)

• Monthly (1, 2, 3... months)

• Yearly

However, it does not support repayments that occur twice within the same calendar month (for example, on the 1st & 15th or 15th & Last Day of Month).

This enhancement introduces a new repayment frequency specifically designed for semi-monthly lending products.

Business Requirement

Many payroll loans, salary advances, consumer loans, and working capital products require repayments aligned with payroll cycles.

Examples:

• 1st and 15th of every month

• 15th and last day of every month

• 10th and 25th every month

These schedules cannot be achieved using existing configurations like:

• 15-day intervals (drifts over time)

• Bi-weekly schedules (26 payments/year)

• Monthly schedules

Semi-monthly schedules always generate 24 repayments per year.

Current Limitation

Current repayment frequency configuration:

For monthly frequency:

Minimum value:

There is no way to specify

or

Functional Requirement

Introduce a new repayment frequency type instead of attempting to support 0.5 month.

New Frequency Configuration for Half-Monthly:

Validation Rules

Rule 1

Second repayment day must be greater than first repayment day.

Example:

Rule 2

Second repayment Dates must be between

Supporting 29/30/31 requires end-of-month adjustments.

Rule 3

Duplicate dates are not allowed.

Rule 4

When "Last Day" is configured

System automatically uses:

• 28 Feb

• 29 Feb (Leap)

• 30 Apr

• 31 Jul

Rule 5

Leap Year

Configuration

Produces

Non-Leap Year

Produces

Thirty-day Month

Thirty-one-day Month

Rule 6: Loan Disbursed After First Due Date

Configuration

Disbursement

First repayment

If disbursement occurs after both configured dates (for example, 20 Jan), the first repayment should be generated on the next available configured date (1 Feb).

Schedule Generation Examples

Example -1

Suppose

Loan Disbursement

Configuration

Schedule

Note:

Always exactly two repayments per month.

Example -2

Disbursement

Configured dates

Schedule

Note:

System skips past repayment dates.

Example -3

Loan Amount

Disbursement

Interest

Term

Repayment Frequency

Payments

Example Equal Principal

Note: The above schedule is illustrative. Actual installment amounts in Fineract will depend on the selected amortization method (equal installments, equal principal, declining balance/EIR, etc.).

Impact on Existing Features

No functional changes required for:

• Interest calculation

• Delinquency

• Charges

• Penalties

• Accounting

• Accruals

• COB Jobs

• Repayment processing

• Prepayment allocation

• Rescheduling

• Write-off

• Charge-off

Only the schedule generation engine requires enhancement.

Acceptance Criteria

1. A loan product can be configured with a Half-Monthly repayment frequency.

2. Users can configure two repayment dates within each month.

3. The system validates that the configured dates are unique and in chronological order.

4. The schedule generator produces two repayment dates per calendar month until the loan term is complete.

5. The Last Day of Month option correctly resolves to the last calendar day, including leap years.

6. Existing repayment processing, delinquency calculations, accounting entries, and COB processing continue to function without modification.

7. Existing repayment frequencies (daily, weekly, monthly, yearly) remain unaffected, ensuring backward compatibility.