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SAP Loans Management Rapid-Deployment Solution

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  1. SAP Loans Management Rapid-Deployment Solution Solution Details

  2. Contents Introduction to SAP Rapid Deployment Solutions Overview of the Solution Solution in Detail • Consumer Loan with and w/o Direct Debit • Mortgage Loan with variable or fixed interests • Accounting for Loans with General Ledger preparation • Additional Business Operations Service Delivery Technical Details

  3. Introduction to SAP Rapid Deployment Solutions

  4. Today’s reality… “ “ • Statistics state that up to 70% of IT projects run late, over-budget, or do not meet planned goals…Consequently, implementation risk is a critical factor… • From “Introducing Packaged Solutions” by Michael Krigsman • Now when companies think about implementing an application, they really want to implement an integrated solution. • Henry D. Morris, Senior Vice President of Worldwide Software and Services, IDC • Customers today want choices in how they scope, configure, and deploy business software. • Peter M. Russo, Managing Director of Pierre Audoin Consultants

  5. You want to… • … ensure the most predictable and fastest time to business value • … deliver the integration the business demands to start and grow without compromises • … choose from a modular ready to use portfolio of solution, deployment and pricing options

  6. SAP and a global partner ecosystem offer Rapid Deployment Solutions to meet specific business needs… • Software • Quickly address the most urgent business processes • Content • SAP best practices, templates and tools make solution adoption easier • Enablement • Guides and educational material speed end user adoption • Service • Fixed scope and price provides maximum predictability and lowers risk SAP Rapid Deployment Solutions Rapid Deployment Solutions Software Service Content Enablement

  7. … which allow predictability, out-of-the-box integration and adoption choices as business demands • Predictability • Fast value in days/weeks • Fixed cost and fixed best practice scope • Integration • Integrated start and growth options • Immediate and future IT and business processes landscape integrity • Choice • Modular packages to meet specific business needs and allow individual adoption paths • Flexible licensing and deployment options SAP Rapid Deployment Solutions

  8. Why have customers chosen SAP Rapid Deployment Solutions? • 8 • Weeksto go-live • 15% • Reduction in project costs • 4 • Week implementation

  9. Delivered by SAP or qualified partners • Large Global Partner Ecosystem maximizes availability of and choice within the Rapid Deployment Solutions portfolio • System integrators and value-added resellers provide industry and LoB specific capabilities and expertise • Cloud partners provide the deployment options to match your business needs

  10. SAP Rapid Deployment Solutions define a new standard for business solution adoption across the SAP Portfolio Solution Portfolio Industry & LoB Deployment Innovations Business Solutions On demand Mobility Analytics On premise HANA Technology On device

  11. SAP Rapid Deployment Solutions support all use cases along your adoption path Predictability Integration Choice From zero to ERP baseline in one goIndustry & geography-ready Start New business and user capabilities – that fit with your existing footprint LoB or industry-specific, mobile, business analytics, collaboration Grow, extend, innovate

  12. Get the most out of your business – NOW! • Quickly meeting your most pressing business needs on unprecedented predictability to adopt and manage business solutions • Enabling strategic business adoption paths with out-of-the-box integration for start and grow options as your business demands • Giving choice by providing a modular and well defined portfolio of solution options together with a Global Partner Ecosystem

  13. Overview of the solution

  14. Becoming the Best in Your BusinessWith SAP as Your Partner Enterprise-Wide Strategic Platform for All Banking Needs SAP Loans Management RDS as one Building Block on top of the Banking Platform • Flexible management of different types of lending – secured or non-secured such as • Mortgage loans* • Personal loans / Consumer Loan* • Corporate loans • Special lending • Flexible definition of lending products supporting additional business operations • Rich condition handling features • Extensive back office support • Large variety of automated processes • Accounting for Loans with General Ledger preparation * Implemented as part of this RDS

  15. Processes and Features in SAP Loan Management rapid-deployment solution • Executing a consumer/mortgage loan from account creation to account closure based on SAP Banking Services 8.0 - including additional business operations (Payment Plan Change, Renewal of the loan contract, Early Payoff, Early Repayment Compensation) • Processing of all steps of the complete loans life-cycle consistently across the various involved systems (FI-CAx, Payment engine, Collateral Management System, Bank Analyzer) • Preparation for integration of General Ledger via posting to Bank Analyzer following principles and restrictions in Accounting for Loans • Implementing a job network to process background jobs for the consumer/mortgage loan

  16. Flexible Management of different types of lending – supporting operational efficiency and excellence • SAP Loans Management rapid deployment solution offers you flexible management of different types of lending – secured or non-secured such as consumer loans and mortgage loans • This RDS enables you to efficiently execute a full consumer / mortgage loans life-cycle, thus gaining a quick insight into the application processes • For the use case installment loan you get a ready to run system with preconfigured processes and an automated end-of-day processwith optional integration towards collateral management, payment engine and accounting • Excellent starting position for flexible adoption and growth • The RDS methodology ensures fixed implementation time at reduced risk and lowered TCI – with the possibility to learn from the implementation team • Long time-to-market for new banking products • Need for a configurable and adjustable loan product system to meet changing business requirements • Inefficient back-office processes causing low customer satisfaction and high loan maintenance costs • Need for a flexible architecture to integrate a new transactional banking system step-by-step into the current system environment • High transformation cost to replace legacy banking systems

  17. Benefits for you • Short-time to market for new banking products • Highly flexible in product configuration • Operational efficient back-office processes reducing loan maintenance costs • Flexible architecture to ease integration into the current system environment • Lower transformation costs for replacing banking systems due to reduced implementation costs resulting from RDS methodology • Run a full loans life-cycle without customization know-how across the various involved systems • Preparation for integration of General Ledger while keeping the feasibility to further streamline the accounting and analytical landscape in the future • Speed-up implementation by reducing testing efforts and providing configuration templates • Get users and configurators quickly up-to-speed • Increase user-acceptance • In a fixed time and for a fixed price (significantly lower TCI) • Low implementation risk * Implemented as part of this RDS

  18. Solution In Detail • Consumer Loan with and w/o Direct Debit • Mortgage Loan with variable or fixed interests • Accounting for Loans with General Ledger preparation • Additional Business Operations

  19. Solution In Detail • Consumer Loan with and w/o Direct Debit • Mortgage Loan with variable or fixed interests • Accounting for Loans with General Ledger preparation • Additional Business Operations

  20. Consumer Loan Lifecycle with and w/o Direct DebitScope and Benefits • This business process enables you to execute a complete loan life-cycle providing quick insight into the application processes and their interdependencies • Provides the description and configuration to ensure the processing of all steps consistently across the various involved systems • Helps to limit the number of manual steps that need to be executed during testing since most of the periodic steps are automated • This business process covers the most common steps in the consumer loan life-cycle, starting with the customer signing the contract and the bank entering the contract into the system. From there, it covers the entire loan life-cycle from account creation to account closure, including the daily processing in account maintenance, periodic payments, as well as typical events such as payment plan change or early payoff • The process is well integrated across the involved system components that include besides of SAP Loans Management: • Integration with FI-CAx for Open Item Management • Integration with Payment Engine • Preparation for integration of General Ledger via posting to Bank Analyzer • The integration with SAP PE and SAP Bank Analyzer/AFI is optional • Integration content is provided based on SAP NW PI

  21. Consumer Loan Lifecycle - in the system • Key process flows covered • Creating and maintaining a business partner and replication into integrated systems as FI-CAx or AFI • Creating and maintaining a loan account • Full disbursement of a loan account to an internal current account (with and w/o disbursement charge) • Display account specific balances and key figures • Normal/periodic loan life cycle • Handling of due date processing (billing, invoicing in FI-CAx) • EITHER manual posting of incoming payments / OR Posting of direct debit payment from the current account to the loan clearing account • Handling of payment distribution / settlement • Handling of manual or optional processes (business operations): Early payoff, payment plan change • Handling of account closure (after regular repayment of the loan account or after payoff) L45: Overview of Jobs of a Process Flow

  22. 1. Process Flow – Consumer Loan with Direct Debit SAP Banking Services: Account Management + Collateral Management SAP ERP FI-CAx 1a Create BP Create BP Full Payoff, Payment Plan Change* Disbursement Full / Forward Disbursement 2a Create Contract Account Create Loan / Clearing Acct 4a Invoicing Billing 7a Clear due items Settlement Payment Distribution Create Direct Debit Order Fully automated Outgoing Payment Dispatcher Distribute Data 10. Account Closure SAP Bank Analyzer 9a Aggregation 9b Subledger Posting SAP Payment Engine 6a Enrich and Validate 6b Routing 6c Clearing and Settlement * Optional Step

  23. 2. Process Flow – Consumer Loan with Customer Bank Transfer SAP Banking Services: Account Management + Collateral Management SAP ERP FI-CAx 1a Create BP Create BP Full Payoff, Payment Plan Change* Disbursement Full / Forward Disbursement 2a Create Contract Account Create Loan / Clearing Acct 4a Invoicing Billing 6a Clear due items Post Incoming Payment Settlement Distribute Data 5dPost Clearing Payment Payment Distribution Fully automated Account Closure SAP Bank Analyzer 9a Aggregation 9b Subledger Posting SAP Payment Engine 5a Enrich and Validate 5b Routing 5c Clearing and Settlement * Optional Step

  24. Solution In Detail • Consumer Loan with and w/o Direct Debit • Mortgage Loan with variable or fixed interests • Accounting for Loans with General Ledger preparation • Additional Business Operations

  25. Mortgage Loan with variable or fixed interestScope and Benefits • This business process enables you to execute a complete life-cycle of a mortgage loan with variable or fixed interest providing quick insight into the application processes and their interdependencies • Provides the description and configuration to ensure the processing of all steps consistently across the various involved systems • Helps to limit the number of manual steps that need to be executed during testing since most of the periodic steps are automated • This business process covers the most common steps of the life-cycle of a mortgage loan with variable or fixed interests, starting with the customer signing the contract and the bank entering the contract into the system. From there, it covers the entire mortgage life-cycle from account creation to account closure, including the daily processing in account maintenance, periodic payments • The process is well integrated across the involved system components that include: • Integration with FI-CAx for Open Item Management • Integration with Payment Engine (SEPA/SWIFT) • Integration with Collateral Management • Preparation for integration of General Ledger via posting to Bank Analyzer • The integration with SAP PE, SAP CMS and SAP Bank Analyzer/AFI is optional • Integration content is provided based on SAP NW PI

  26. Mortgage Loan Lifecycle - in the system • Key process flows covered • Creating and maintaining a business partner and replication into integrated systems as FI-CAx or AFI • Capturing the real estate which is used as collateral object and associating the mortgage agreement which is supposed to secure the requested mortgage loan • Creating and maintaining a mortgage account with variable OR fixed interest • Creating mortgage insurance and associating it to the secured mortgage loan • Partial and full disbursement of a mortgage loan to the customer’s external account (SEPA/SWIFT) via the payment engine (with and w/o disbursement charge) • Display account specific balances and key figures • Regularly check collateral coverage • Normal/periodic loan life cycle • Handling of due date processing (billing, invoicing in FI-CAx) • Posting of incoming payments from external account via the payment engine • Handling of payment distribution / settlement • Handling of manual or optional processes for fixed and variable interest mortgage loans (business operations) • Handling of account closure (after regular repayment of the mortgage loan) • Discharge and release the collateral mortgage and set the mortgage insurance to inactive as the secured loan was paid off

  27. 3. Process Flow – Fixed & Variable Revolving Interest Mortgage Loan with Direct Debit SAP Banking Services: Account Management + Collateral Management SAP ERP FI-CAx 1a Create BP Create BP Create Collateral Object* Create Collateral Agreement* 2a Create Contract Account Create Loan / Clearing Acct Full/ Partial/ Forward Disbursement Full/Partial Payoff, Payment Plan Change, Renew Loan* 4a Invoicing Billing 7a Clear due items Settlement Payment Distribution Create Direct Debit Order Fully automated Outgoing Payment Dispatcher Distribute Data Discharge Collateral Object* Account Closure Renewal Notification SAP Bank Analyzer 9a Aggregation 9b Sub-ledger Posting SAP Payment Engine 6a Enrich and Validate 6b Routing 6c Clearing and Settlement * Optional Step

  28. 4. Process Flow – Fixed & Variable Revolving Interest Mortgage Loan with Customer Bank Transfer SAP Banking Services: Account Management + Collateral Management SAP ERP FI-CAx 1a Create BP Create BP Create Collateral Object* Create Collateral Agreement* 2a Create Contract Account Create Loan / Clearing Acct Full/ Partial/ Forward Disbursement Full/Partial Payoff, Payment Plan Change, Renew Loan* 4a Invoicing Billing Fully automated 6a Clear due items Post Incoming Payment Distribute Data Payment Distribution Settlement 5d Post Clearing Payment Discharge Collateral Object* Account Closure Renewal Notification SAP Bank Analyzer 9a Aggregation 9b Sub-ledger Posting 9a Aggregation 9b Subledger Posting SAP Payment Engine 5a Enrich and Validate 5b Routing 5c Clearing and Settlement * Optional Step

  29. Solution In Detail • Consumer Loan with and w/o Direct Debit • Mortgage Loan with variable or fixed interests • Accounting for Loans with General Ledger preparation • Additional Business Operations

  30. Accounting for Loans with General Ledger preparation • Customers who decide for SAP core banking require a sufficient sub-ledger solution. In a first step without facing the complete depth of SAP Bank Analyzer functionality but still keeping the feasibility to streamline its accounting and analytical landscape in the future • Accounting for loans offers a reduced set of financial accounting functions defined to best fit into legacy environment – offering the option to customers to later replace third party operational systems by SAP full accounting solution of SAP Bank Analyzer. • Source Data Aggregation (SDA) reduces the run time and the produced data volumes of subsequent analytical processes. • The accounting solution of the SAP Bank Analyzer is used as a sub-ledger. The integration scenario Financial Accounting for Banks is part of the product Banking Services from SAP 8.0. • It covers the integrated end-to-end scenario (Integrated Operational & Analytics [IOA] scenario) that begins in the area of responsibility of operational banking and ends in analytical banking for accounting purposes of loan accounts with preparation of documents for General Ledger. • Accounts and business transactions will be aggregated assuming that full validation within Bank Analyzer is not required) • This RDS AFI for Loans supports: • Loans in general with linear accrual calculation • Loans without premium / discount

  31. Preparation of GL Integration - in the system • Key process flows covered • Distribute business partner, account master data and flow data from SAP AM to SAP Bank Analyzer AFI • Handling of payment distribution and settlement in SAP AM • Source Data Aggregation (SDA) steps in SAP Bank Analyzer L49: Overview of Position Balances • Generatepositions on financialtransactionlevel • Aggregate financialtransactions • Prepareandprocess all newbusinesstransactions for aggregation • Processre-assignment for businesstransactions • Aggregate business transactions • Derive application events for source data aggregation • Handling ofaccruals • Post external business transactions • Update secondary business transactions • Prepare General Ledger documents

  32. Solution In Detail • Consumer Loan with and w/o Direct Debit • Mortgage Loan with variable or fixed interests • Accounting for Loans with General Ledger preparation • Additional Business Operations

  33. Additional Business Operations -Scope and Benefits • Management of different types of lending (consumer and mortgage loans) with flexible product configuration to address typical customer events like Payment Plan Change, Renewal of the Loan Contract or Early Payoff in the loan lifecycle. • Provides the possibility to store overpayment options such as limits for overpayment in order to calculate a penalty for unscheduled early payments • Provides the configuration and description of the additional business operations in the context of the complete loan life-cycle • Simplifies testing with detailed process descriptions • Payment Plan Change (PPC): The payment plan change business operation is used in situations where banks want to respond a customer’s request to reduce or extend the duration of a loan, or where the customer wants to change the date on which the repayment is due. • A renewal of the loan contract is necessary when: • The conditions the bank and the borrower have agreed upon expire and an outstanding balance is expected on this date. • The borrower wants to change the conditions.. • Early Payoff: Either the loan is repaid fully by regular installments, or it is settled before the end of the term by an early full payoff. • Early Repayment Compensation (ERC):The ERC is used as a penalty when the customer makes an early payoff which is over the ERC limit

  34. Additional Business Operations - in the system • Key process flows covered • Not all Business Operations are allowed for every product. Here is an overview of all possible combinations to use additional business operations in the context of different products: • Consumer Loan Lifecycle / Consumer Loan Lifecycle with Direct Debit: • Payment Plan Change • Full Payoff • Revolving Mortgage Loan Lifecycle: • Payment Plan Change • Full or Partial Payoff • Fixed Interest Mortgage Loan Lifecycle: • Payment Plan Change • Renewal • Full or Partial Payoff • Early Repayment Compensation L50 / Change Payment Plan

  35. Service Delivery

  36. Rapid implementation in as little as 7 weeks 1 2 3 • Start • Run • Deploy Expectations • Kick off workshop and project planning • Scoping workshop • Define Project Organization, Roles and Responsibilities • Team Onboarding • Setup of Project Logistics and Infrastructure • System landscape and RDS installation • Implementation of RDS Loans Life Cycle • Key User Knowledge Transfer • Testing • Handover to customer and sign-off • Superior support to ensure smooth functioning • Working scenario of SAP Loans Management for Banking system • Successful rollout and adoption • Mutually-approved scope document • Team defined together with roles and responsibilities Results

  37. Implementation methodology 1 2 3 Start Deploy Run Kickoff Workshop Configuration Guide Project Schedule Scoping Questionnaire Check Lists Support Portal Note: This slide represents a typical deployment. Exact details may differ according to solution.

  38. Project plan and timelines 1 2 3 Start Deploy Run • Kick-Off Workshop & Project Planning • Scoping Workshop • Define Project Organization, Roles and Responsibilities • Team On-boarding • Setup of Project Logistics and Infrastructure • System landscape and RDS installation • Implementation of RDS Loans Life Cycle – including Bank Analyzer, Payment Engine and PI • Key User Knowledge Transfer • Consolidation and Acceptance Test and Testing Guidance • Handover to customer and Sign-off SAP involvement Customer involvement

  39. Rapid implementation in as little as 7 weeks A special step-by-step guide describes each activity during the deployment

  40. Key deliverables • Provide the IT infrastructure (server) • Provide fixed contact people in the business and IT department • Test and validation • Software installation and installation check • Initial scoping workshop to qualify customer requirements and scoping exercise • Project documents: project plan and WBS activities • Customization of chosen packages for the SAP Loans Management rapid deployment solution in the development system. Furthermore customization of chosen packages for Payment Engine, SAP Collateral Management, Bank Analyzer and SAP PI • Knowledge transfer to key users on configured SAP Loans Management rapid deployment solution system

  41. Project team: SAP • SAP Project Lead • Serves as a central contact person, from project initiation to going live and support • On the SAP side, responsible for functional project management, coordination, support and coaching of the customer’s project manager, and so on • SAP Consultants • Application Consultant: • Application consultant SAP Loans Management on Banking Services • Particularly responsible for monitoring process configuration, and know-how transfer • Responsible for implementation of the agreed scope for the SAP Loans life-cycle rapid deployment solution

  42. Project team: SAP • SAP Consultants • Application Consultant: • Application consultant SAP FI-CAx • Application consultant for SAP Payment Engine • Application consultant for SAP Collateral Management • Application consultant SAP Bank Analyzer/AFI • Particularly responsible for monitoring process configuration • SAP Integration Technology Consultants • Technology consultant: • Particularly responsible for set/up and configuration of SAP PI • Development consultant

  43. Project team: customer • Leading Project Manager • Serves as a central contact person, from project initiation to project finalizing • Responsible for functional and commercial project management, coordination, overall project controlling and preparation of steering committees • Technology consultant • Especially responsible for the administration of the system landscapes (job scheduling, system monitoring, etc.) • Subject Matter experts • Key user(s) and business owner: responsible for workshops, questions from SAP, end-user training, and possibly as a power user for simple configurations • Representatives of the Loans Management IT Department

  44. Technical Details

  45. Software requirements Required • SAP Loans Management for Banking 8.0 Optional • SAP Collateral Management for Banking 8.0 • SAP Payment Engine • SAP Bank Analyzer/Accounting for Financial Instruments (AFI) (8.01) • SAP Banking Services 8.0 is based on SAP NetWeaver 7.11 • SAP FI-CAx 6.0 EHP5 • SAP Process Integration 7.31

  46. System landscape Account Origination SAP CRM Open Item Management System SAP FI-CAX Banking Services 8.0 from SAP Loans Management Bank Analyzer Business Intelligence SAP NetWeaver BW Payment Transaction System SAP PE Collateral Management Output Management System StreamServe General Ledger SAP GL SAP NetWeaver Process Integration Please see SAP Marketing, Sales, and Service for Banking rapid-deployment solution for branch agreement origination scope • Required components/software versions for SAP Loans Management for the Banking rapid- deployment solution (marked with yellow color) • The other shown components (not part of RDS) can be used from SAP as well or alternativly these functions can be covered by already existing or 3rd party banking systems not in scope other

  47. Further information…. è è Deposits Management RDS for transaction history analysis with SAP HANA HANA on Service Marketplace :www.service.sap.com/rds-hana-transhis Bank Analyzer RDS for financial reporting with SAP HANA on Service Marketplace :www.service.sap.com/rds-hana-finrep è è è è è Loans Management RDS on Service Marketplace :www.service.sap.com/rds-loans Deposits Management RDS on Service Marketplace :www.service.sap.com/rds-deposits All RDS Packages on Service Market Place :www.service.sap.com/solutionpackages All Banking RDS Packages on Service Market Place :www.service.sap.com/rds-banking Data Migration for Loans Management RDS on Service Marketplace :www.service.sap.com/rds-DM4LM SAP Software è SAP Rapid Deployment Solutions:www.sap.com/rds SAP Predefined Services Pre- Configured Content Enablement Content SAP Rapid Deployment Solutions

  48. SAP Rapid-Deployment solutionsThe fastest way to run your business better