Changing Interest Rates on Active Deposit Accounts

Clients with deposit accounts can either receive credit interest for the amount they save, or they can be charged debit interest if their accounts go into overdraft.

Credit interest rates

Credit interest is the interest you owe your clients for the amount they keep in your bank or financial institution.

Product level changes

When you change the interest rate at the product level, the change will apply to the deposit accounts using that product.

If you are making a change via the UI, you will be prompted to select whether this change should apply to either all existing and new accounts or to new accounts only.

The change will be applied the next time the end of day processes are run.

Account level changes

Credit interest rate updates

Fixed interest rates

The interest rate at the account level is set, and remains fixed unless renegotiated or personalised for the client. To make changes via the API, make a POST request to the /deposits/{depositAccountId}:changeInterestRate endpoint. For more information, see Deposits - Change Interest Rate in our API Reference.

With this endpoint, you can increase or decrease credit interest rates on individual Current, Savings and Fixed Deposit accounts within the product constraints.

You can specify a new interest rate within the defined product constraints using the field interestRate and supplying the value date or date on which you want the change to be applied in an API body such as this:

{
  "interestRate": 1.2,
  "notes": "Rewarding client for loyalty.",
  "valueDate": "2020-04-26"
}

Once executed, a non-financial transaction, "Interest Rate Changed", will be logged in the transaction history of the account with the new rate.

When changing interest rates on individual deposit accounts, previously accrued interest will not be applied, it will be recalculated from the valueDate with the new credit interest rate. Mambu simply continues to accrue interest based on the rate and valueDate provided in the API call.

You can retrieve all Interest Rate Changed transactions by making a GET request to the /deposits/{depositAccountId}/transactions endpoint. For more information, see Deposit Transactions - Get all transactions for a deposit account in our API Reference.

Index interest rates

Changing the interest spread on credit index interest rates is not possible. For updates, please follow our release notes.

Tiered per Balance, Tiered per Period, and Tiered per Band interest rates

To change the interest rate at product level:

1. Open the deposit account.
2. On the right-hand side of the screen, select More > Edit account.
3. In the Editing deposit account form, under Product, take a note of the deposit product used to create the account.
4. Go to Administration > Products > Deposits.
5. In the list of deposit products, find the one you want to edit and select Actions > Edit.
6. Make changes to the tiered interest rates.
7. Select Save Product.
8. Before confirming, choose if you want your changes to apply to All existing and new accounts or to New accounts only.

To change the interest rate via API, make a POST request to the /depositproducts/{depositProductId}:batchUpdate endpoint in API v2. For more information, see Deposit Products - Batch Update in our API Reference.

All accrued interest will be re-calculated at the new rate starting from the next day.

If an account has USD20 of accrued interest, and the interest rate increases, then the amount of accrued interest will increase.

When the interest is applied, the total amount of interest for the period is calculated as the sum of the daily interest calculated as above using daily interest, truncated to 20 decimal places. For more information, see Truncating and rounding interest.

Mambu allows you to change positive interest rates at the account level. The Tiered Per Bands interest calculation method also supports negative rates. Negative interest rates cannot be changed.

Debit interest rates

Debit interest is the interest your clients owe you for the use of an overdraft facility, expressed as an annual percentage of the amount the client is overdrawn.

Product level changes

When you change the debit interest rate at the product level, the change will apply only to all new deposit accounts created under that product and not to any existing accounts. To update the debit interest rate for existing accounts, make a PATCH request to the /savings/{savingsAccountId} endpoint in API v1. For more information, see Savings accounts -Edit existing savings account. There will be no transaction booked for the change of interest rate, but you would see the new rate updated in the Details tab of the Mambu web app.

Account level changes

Debit interest rate updates

To change the debit interest rate at account level:

1. Open the loan account.
2. On the right-hand side of the screen, select More > Adjust Overdraft Terms.
3. In the Adjust Overdraft Terms dialog, under Interest Rate, update the interest rate.
4. Select Save Changes.

Backdating interest rate changes

You can backdate credit interest rate changes on active accounts via API only. The same conditions apply as for the regular changes presented above.

You can backdate interest rate changes on individual Current, Savings and Fixed Deposit accounts by making a POST request to the /deposits/{depositAccountId}:changeInterestRate endpoint. For more information, see Deposits - Change Interest Rate in our API Reference.

Simply set a valueDate in the past and backdate interest rate changes.

{
  "interestRate": 1.2,
  "notes": "Rewarding client for loyalty.",
  "valueDate": "2020-03-26"
}

Once executed, a non-financial transaction "Interest Rate Changed" will be logged in the transaction history of the account.

You can retrieve all Interest Rate Changed transactions by making a GET request to the /deposits/{depositAccountId}/transactions endpoint. For more information, see Deposit Transactions - Get all transactions for a deposit account in our API Reference.