What is early withdrawal penalty in SAP FS-AM-OM-AC - Account Order?

SAP Term: early withdrawal penalty

• Component: FS-AM-OM-AC

• Component Name: Account Order

• Description: A certain amount that bank customers have to pay for making an early withdrawal from a time deposit. The early withdrawal penalty is either debited directly to the time deposit account or is deferred for capitalization taking place at a later date.

Smart SAP Assistant

• Key Concepts: 
  Early withdrawal penalty is a fee that is charged when a customer withdraws funds from an account before the maturity date. This fee is typically charged to discourage customers from withdrawing their funds early and to protect the financial institution from losses. 
  
  How to use it: 
  In SAP FS-AM-OM-AC Account Order Management, early withdrawal penalty can be set up as a fee type in the system. This fee type can then be assigned to specific accounts or products, and the amount of the fee can be determined by the financial institution. The fee will then be automatically charged when a customer withdraws funds from an account before the maturity date. 
  
  Tips & Tricks: 
  When setting up early withdrawal penalty in SAP FS-AM-OM-AC Account Order Management, it is important to ensure that the fee amount is appropriate for the product or account type. It is also important to ensure that the fee is clearly communicated to customers so that they are aware of it before they make a withdrawal. 
  
  Related Information: 
  Early withdrawal penalty is just one of many fees that can be set up in SAP FS-AM-OM-AC Account Order Management. Other fees that can be set up include late payment fees, overdraft fees, and minimum balance fees.