Employee Loan Management Made Easy with FOX HR
FoxHR
The user can develop and manage employee loan policies with the FOX HR Employee loan management module.
Employees can apply for loans, which are then examined, accepted, and turned into a loan agreement that includes payment terms, interest rate, and loan life.
The payroll module will consider any outstanding loan or advance payments when computing an individual’s monthly payments during the payroll process.
FOX HR Employee Loans
The user can log in to FOX HR using the following steps:
Fox HR→ Customer Configuration→ HR Policies→ Payroll Management→ Employee Loans.
In the dropdown menu of Payroll management, the seventh option shall be ‘Employee Loans.’ When the user clicks on the ‘Employee Loans’ option, the system will navigate to a new page. The page shall be the Employee Loans View and Configuration page.
Employee loans can be defined as the money paid in advance by an organization to its employees in the form of financial assistance. The loan should be repaid as per the repayment schedule by the employee. Usually, Employee loans will not have any interest rate attached to it.
FOX HR Employee Loan Types
The Types of Employee Loans shall be grouped under the ‘Loan Types’ field set. Examples of Loan Type is Vehicle Loan, Personal Loan, etc. Loan Types shall be displayed in a card format with the details on the card.
The Loan Type shall have options:
- Loan Details – The details of the Loan type shall be defined here.
- Save (or) Cancel the changes made to the details by clicking the ‘Save’ / ‘Cancel’ button.
Loan Policy
The second option under Employee Loans is ‘Loan Policy.’ The Loan policies for various organization entities shall be grouped under the ‘Loan Policy’ fieldset.
The loan Policy shall be displayed in a card format with the details on the card. The card shall have the following display fields in it. There shall be an option for the user to view and edit the Loan Policy from each Card.
The Loan Policy shall have options:
In FOX HR Employee loan policy, it will have the following details such as:
Applicable Amount
The amount shall be calculated concerning the employee’s salary for taking the Loan. The employee can take a loan within the amount defined in this policy.
There shall be two options: ‘ ‘Basic Salary’ and the second is ‘Full Package.’
If the Basic Salary is selected, the Loan amount shall be with respect to the Basic Salary of the respective employee. If the ‘Full Package’ is selected, then the Loan amount shall be with respect to the Full Package of the respective employee. i.e., full salary, including all allowances.
The field shall be a radio button with two options, ‘ Basic Salary’ and ‘Full Package,’ and ‘Full Package’ shall be selected by default.
Maximum Loan Amount Applicable
When the employee requests a loan, the maximum amount that can be availed shall be the multiple of ‘Maximum Loan Amount Applicable’ to the ‘Applicable Amount’ selected in the previous field.
Minimum Service Years to apply for a loan
Fox HR has an option to define minimum service years for an employee to apply for a loan. There shall be a dropdown field with the number of years; the dropdown field shall have numeric values from 0 to 99. The default value shall be 0.
Defining this field system shall validate the Loan request for an employee by checking his service years with the company, and if eligible, only the request will be allowed to proceed. i.e., if the ‘Minimum Service Years to apply for a loan’ field is set as three and if the employee who requests for a loan doesn’t have three years of experience in the company, the loan request system will validate this and not allow proceeding with the loan request.
Allow multiple active Loans
There shall be a provision for the user to define whether to allow multiple loans, i.e., whether an employee can take another loan while an existing loan is still not fully paid.
There shall be a toggle button, if the toggle button is ON, then the value shall be Yes, and the system shall allow new loans for the employee even if there exists an active loan for that employee. If the toggle button is OFF, then the value shall be No, and the system shall not allow new loans for the employee if there exists an active loan for that employee.
Restrict total loan Amount to Final Settlement
Fox HR shall provide the administrator an option to define whether to restrict the total loan for an employee to the Final Settlement balance available for the employee. The Final Settlement shall be accrued for each employee during his service years and shall be provided to the employee during the ‘End of Service’ process in line with each country’s labor law.
There shall be a toggle button, if the toggle button is ON, then the value shall be Yes, and the system shall check the Final Settlement amount for the employee each time the employee requests a loan. The total sum of all loans should be within the Final settlement amount. If the toggle button is OFF, the value shall be No, and the system shall not check the final settlement amount when requesting a loan.
Applicable Loan Types
There shall be an option to select applicable loan types for each loan policy. There shall be a multi-select dropdown field to select multiple loan types applicable to the loan policy. The Loan types shall be listed from the loan type master as per the organization hierarchy.
To sum up
FOX HR employee loan management thus helps employees apply for loans easily, and it provides transparency for both the employees and HR teams alike.
Recent Post
FoxHR
Emerging Technologies and HRMS: Preparing for the future of Work
The post-COVID-19 pandemic era has brought magnanimous changes, significant disruptions, and enormous global breakthroughs, and businesses are getting utilized with the new ongoing innovative trends.
FoxHR
Powering HR for the Future with AI
Artificial Intelligence has been creeping into the modern workplace, and organizations are looking for ways to implement AI to uplift organizations and improve the employee experience. It has become the new normal in various industries across the globe.
FoxHR
Improving Workforce Management with Big Data
Integrating Big Data in workforce management can drive employee performance and enable businesses to stay ahead of the competition. Businesses that have implemented big data can have access to a large pool of employee data and business processes. These large data sets can be combined and analyzed to evaluate the ongoing developments in business performance.
FoxHR
What is Strategic Human Resource Management: HRMS and the future of Work
The future of work looks different. With the emergence of the COVID-19 pandemic, organizations have shifted to innovative, evolved, and digitized business processes.
