Summary

A reducing balance loan allows regular fixed amount deductions to be automatically deducted from an employee's pay each pay period until a pre-set total is reached.

Set up a reducing balance loan when you know the total balance of the loan, and regular repayments will be made of the same dollar amount.

Examples

Reducing balance loans can be used to repay debts or make payments such as:

• Court fines.
• Company loans.
• Over payments.
• Taxation department repayments.

Procedure

To set up a reducing balance loan:

1. Set up a reducing balance loan deduction.
2. Set up a loan for an employee.