Lending facilities

A facility is an agreed arrangement a customer can draw against. Woodgrove Bank agrees a personal lending facility of 100,000 with Alex. Alex can then take loans up to that amount, one account at a time or several at once.

A facility belongs to the customer, not to an account. Many accounts draw against one facility, and the facility keeps the running total of what is drawn and what is left.

What a facility is made of

A facility has four things: a customer, a facility type, a currency, and an amount.

Part	What it does
Customer	The party the arrangement is with. The facility lives on their record.
Facility type	What the arrangement is for — personal lending, a mortgage, working capital, a guarantee. Your organisation defines the list.
Currency	Fixed when the facility is granted. Only accounts in that currency draw against it.
Amount	The agreed limit.

A customer holds at most one facility per facility type per currency. If you try to grant a second of the same type and currency, the system refuses it and tells you one already exists. A customer with a mortgage facility and a working-capital facility holds two, tracked separately.

A facility has no expiry date and no review date. It stays as granted until someone changes it.

Facility or credit limit?

Both cap how much a customer can owe you, and both are checked at the same moment. They differ in shape.

	Facility	Credit limit
How many per customer	One for each facility type and currency, so a customer can hold several	One
Currency	Fixed. Only accounts in the same currency count against it	One currency, and drawings in other currencies convert at the day’s rate
Review date	None	Carries a next review date
What it caps	Drawings for one kind of lending	Everything the customer owes you

A customer can be subject to both at once. An account type can be wired to a facility, to a credit limit, or to both — in which case activation has to satisfy each of them. See credit limits.

Granting a facility

Open the customer’s record and select the Facilities panel.
Select Grant Facility.
Choose the Facility Type.
Choose the Currency. Where your organisation trades in one currency, this is filled in for you.
Enter the Amount and submit.

Granting a facility can need a second approver. Until the approval is given, the panel marks the facility as pending and shows you the figures that will apply once it is approved. See countersign.

Reading the Facilities panel

Each facility gets its own card: a utilisation dial, the four figures, and a trend chart of the limit against utilisation over time. The gap between the two lines is the headroom left.

Figure	What it tells you
Limit	The agreed amount.
Utilised	How much of it is drawn right now.
Available	Limit less utilised — what the customer can still draw.
Utilisation %	Utilised as a percentage of the limit. The dial turns amber at 80% and red at 100%.

Alex holds a facility of 100,000 and has drawn 25,000 of it. The card reads: limit 100,000, utilised 25,000, available 75,000, utilisation 25%. Every figure is in the facility’s own currency.

How drawing and repaying move the numbers

Drawing is not something you do on the facility. It happens when money moves on an account that is wired to the facility.

flowchart LR
    A["Money moves<br/>on the account"] --> B["The balance the facility<br/>watches changes"]
    B --> C["Match on customer,<br/>currency and facility type"]
    C --> D["Utilised goes up or down<br/>by the same amount"]

Your organisation chooses which balance on the account drives the facility — see position types. Everything that moves that balance counts, not only the amount advanced. Fees and taxes charged when the account opens are drawn against the facility too.

On a facility of 100,000: a drawing of 25,000 takes utilised to 25,000. A repayment of 10,000 takes it back to 15,000. The facility carries one running total across every account drawing against it.

A worked opening: Sam has a personal lending facility of 250,000. Woodgrove Bank activates a loan of 100,000 with an initiation fee of 1,000 and 150 of tax on that fee. Utilised becomes 101,150 — the whole opening balance, not just the 100,000 advanced.

When the facility is checked

This is the part to be clear about. A facility is checked at two moments, and measured at every other.

The facility is checked when an account is activated — and only when the account type says a facility is required. Two things stop the activation:

What is wrong	What you see
The customer has no facility of the required type and currency	The activation is refused, and the message says an approved facility is needed first.
The activation would draw more than is available	The activation is refused, and the message gives the amount needed and the amount available.

The facility is checked again whenever an operator pays money out. A further advance or a readvance that would draw more than is available is refused, and no money moves.

What is wrong	What you see
The customer has no facility of the required type and currency	The payout is refused, naming the facility that is missing.
The payout would draw more than is available	The payout is refused, naming the amount needed and the amount available.

A customer with 10,000 available who is paid a further advance of 20,000 sees it refused, naming 20,000 asked and 10,000 available. Utilised does not move.

The check counts the whole payout. Where the product adds a fee to the balance, the fee draws on the facility too — a 20,000 advance carrying a 1,000 fee needs 21,000 available.

A payout dated in the future is checked against today’s availability, and a payout still waiting to settle is not counted twice.

What is still only recorded. Some movements pass through and are measured, never refused:

Interest and fees charged at end of day. Utilised can pass the limit this way. When it does, available reads zero and the utilisation percentage reads over 100 — the dial goes red, and that is the only thing that tells you.
A correction posted by an administrator.

Freezing or reducing a facility does not reverse drawings already made. It changes what the next activation and the next payout can pass — and an account already over its facility cannot pay out again until there is headroom.

Changing a facility

The panel carries three actions on each facility card.

Action	What it does
Increase	Sets the limit to a new, higher amount.
Decrease	Sets the limit to a new, lower amount.
Freeze	Sets the limit to zero.

One thing to watch: the amount you type into Increase or Decrease is the new limit, not the change. Nothing checks that an increase is upward or a decrease downward, so a mistyped figure lands as typed.

On a facility of 100,000: entering 150,000 into Increase gives a limit of 150,000. Entering 75,000 into Decrease gives a limit of 75,000.

Freezing sets the limit to zero and leaves the drawings alone. A facility of 100,000 with 50,000 drawn, once frozen, reads limit zero, utilised 50,000, available zero. Available never goes negative. The utilisation percentage reads zero as well, because it is measured against a limit that is now zero — read the utilised figure, not the dial, on a frozen facility.

Freezing is reversible. Use Increase to set a limit again.

Increases, decreases and freezes can each need a second approver, the same as granting.

What your organisation configures

The facility types — the list you choose from when granting. Adding “Overdraft” or “Bridging Loan” is configuration, not a release.
Which customer types show the Facilities panel — a customer type that never borrows does not carry one.
Which account types draw against a facility, and which facility type they draw against. An account type with no facility wiring never touches one.
Which balance on the account drives utilisation.
Whether activation is checked at all. The check is off unless your organisation turns it on for that account type. With it off, the facility still tracks utilisation — it just never refuses anything.
Whether granting and changing a facility need a second approver.