# Overdue tolerance

By default, an account becomes overdue if the minimum amount due (MAD) is not paid by the due date. The **overdue tolerance** feature enables you to set up additional rules that tell the Pismo platform to ignore overdue amounts if they fall within a tolerance range. In other words, if the overdue amount is within a specific range, the platform does not consider the account to be overdue, and overdue charges are not applied.

To configure overdue tolerance, set the following program parameters.

<Table align={["left","left"]}>
  <thead>
    <tr>
      <th>
        Parameter name
      </th>

      <th>
        Definition
      </th>
    </tr>
  </thead>

  <tbody>
    <tr>
      <td>
        **Overdue tolerance percentage**
      </td>

      <td>
        A percentage of the overdue amount that is used by the **Overdue tolerance method** to determine if the account should be considered overdue. Must be greater than 0 and less than or equal to 100.
      </td>
    </tr>

    <tr>
      <td>
        **Overdue tolerance amount**
      </td>

      <td>
        A fixed amount that is used by the **Overdue tolerance method** to determine if the account should be considered overdue. For example, $70.
      </td>
    </tr>

    <tr>
      <td>
        **Overdue tolerance method**
      </td>

      <td>
        The method to apply:

        * *0* — Do not use.
        * *1* — Maximum value. Between the **Overdue tolerance amount** and (MAD x **Overdue tolerance percentage**), use whichever value is greater. If the difference between the payment and the overdue amount is less than or equal to this value, the account is not considered overdue.
        * *2* — Minimum  value. Between the **Overdue tolerance amount** and (MAD x **Overdue tolerance percentage**), use whichever value is lower. If the difference between the payment and the overdue amount is less than or equal to this value, the account is not considered overdue.
      </td>
    </tr>
  </tbody>
</Table>

# Examples

## Example 1

Suppose you set the program parameters as follows.

| Parameter name                   | Value       |
| :------------------------------- | :---------- |
| **Overdue tolerance percentage** | 10%         |
| **Overdue tolerance amount**     | $70         |
| **Overdue tolerance method**     | 1 (Maximum) |

Suppose that:

* Minimum amount due (MAD) is $100.
* A payment is made of $80.
* Payment is received after the due date.

The overdue amount is:\
minimum amount due - the payment = 100 - 80 = $20.

Since the tolerance method is set to 1, the platform uses the higher of the following values:

* **Overdue tolerance amount** : $70
* Calculated tolerance percentage: MAD x **Overdue tolerance percentage** = 100 x 10% = 100 x 0.1 = $10

Because $70 is greater than $10, the platform uses $70 as the actual tolerance value. The overdue amount is $20, which is less than $70, so the Pismo platform **does not** consider the account overdue.

## Example 2

Suppose you set the program parameters to the same values as in Example 1, except that **Overdue tolerance method** is set to 2.

| Parameter name                   | Value       |
| :------------------------------- | :---------- |
| **Overdue tolerance percentage** | 10%         |
| **Overdue tolerance amount**     | $70         |
| **Overdue tolerance method**     | 2 (Minimum) |

Suppose that:

* Minimum amount due (MAD) is $100.
* A payment is made of $80.
* Payment is received after the due date.

The overdue amount is:\
minimum amount due - the payment = 100 - 80 = $20.

Since **Overdue tolerance method** is set to 2, the Pismo platform uses the lower of the following values:

* **Overdue tolerance amount** : $70
* Calculated tolerance percentage: MAD x **Overdue tolerance percentage** = 100 x 10% = 100 x 0.1 = $10

Because $10 is lower than $70, the platform uses $10 as the actual tolerance value. The overdue amount is $20, which is greater than $10, so the Pismo platform **does** consider the account overdue.

## Example 3

Suppose `Overdue tolerance amount` is set to $70, and `Overdue tolerance percentage` is not set. In this case, `Overdue tolerance method` is not applicable and is ignored by the platform.

**Note:** Table entries marked **N/A** indicate **Not Applicable**.

| Parameter name                   | Value   |
| :------------------------------- | :------ |
| **Overdue tolerance percentage** | Not set |
| **Overdue tolerance amount**     | $70     |
| **Overdue tolerance method**     | N/A     |

Suppose that:

* Minimum amount due (MAD) is $100.
* A payment is made of $80.
* Payment is received after the due date.

The overdue amount is:\
minimum amount due - the payment = 100 - 80 = $20.

The overdue amount is $20, which is less than $70, so the Pismo platform **does not** consider the account overdue.

## Example 4

Suppose `Overdue tolerance percentage` is set to 10%, and `Overdue tolerance amount` is not set. In this case, `Overdue tolerance methods` is not applicable and is ignored by the platform.

**Note:** Table entries marked **N/A** indicate **Not Applicable**.

| Parameter name                   | Value   |
| :------------------------------- | :------ |
| **Overdue tolerance percentage** | 10%     |
| **Overdue tolerance amount**     | Not set |
| **Overdue tolerance method**     | N/A     |

Suppose that:

* Minimum amount due (MAD) is $100.
* A payment is made of $80.
* Payment is received after the due date.

The overdue amount is:\
minimum amount due - the payment = 100 - 80 = $20.

Calculated tolerance percentage: MAD x **Overdue tolerance percentage** = 100 x 10% = 100 x 0.1 = $10

The overdue amount is $20, which is greater than $10, so the Pismo platform **does** consider the account overdue.

## Example 5

Suppose you set the program parameters as follows.

| Parameter name                   | Value       |
| :------------------------------- | :---------- |
| **Overdue tolerance percentage** | 10%         |
| **Overdue tolerance amount**     | $70         |
| **Overdue tolerance method**     | 1 (Maximum) |

Suppose that:

* Minimum amount due (MAD) is $50.
* No payment is made.

The overdue amount is:\
minimum amount due - the payment = 50 - 0 = $50.

Since **Overdue tolerance method** is set to 2, the Pismo platform uses the greater of the following values:

* **Overdue tolerance amount** : $70
* Calculated tolerance percentage: MAD x **Overdue tolerance percentage** = 50 x 10% = 50 x 0.1 = $5

Because $70 is greater than $5, the platform uses $70 as the actual tolerance value. The overdue amount is $50, which is less than $70, so the Pismo platform **does not** consider the account overdue.

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