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What to have in a Portfolio Processing Engine


What to have in a
Portfolio Processing Engine

A Portfolio Processing engine is at the heart of any financial ecosystem. It’s important to make sure that the heart of your financial system is able to process millions of transactions without missing a beat. Here are the three most important things to maintain a healthy Financial System: Integrity of Modifications, Granular Realtime Processing & Consolidation and the Ease of Integration.

Integrity of Modifications

A loan, line of credit, lease or a deposit account system must continuously process different modification transactions during its lifetime. Some examples are
·       Extending the term of Loan or a lease contract
·       Adding, removing or replacing the asset/collateral
·       Changing the interest rate and/or methods
·       Adjusting or waiving of any fees and expense amounts and/or methods
·       Modifying the type of loan, lease or line of credit such as revolving to non-revolving
·       Changing the name, address, credit or financial details of a customer or asset
·       Modifying the tax rates, payment amounts, payment schedules or payment allocation
·       Reversing, Correcting or Backdating any modification transaction
It’s extremely critical that the core processing engine has the ability to execute these modifications flawlessly. It should also have, the ability to track, validate, secure and audit the integrity of the contract balances resulting from these transactions.

Granular Realtime Processing & Consolidation

The next important thing is to maintain the granularity of the transaction at an appropriate level and consolidate it based on hierarchy. Next Generation Portfolio Processing Engines use modern advancements in technology like Event Driven Architecture for real-time processing. It is crucial to ensure that your batch processing is at the right granularity and is scalable. It provides the resiliency for exception handling especially while using a legacy system. It should have the ability to restart and seamlessly scale business demands. If not, processing these transactions will hamper your business.  

Ease of Integration

The core Portfolio Processing Engine processes all the modification/query transactions in the eco-system, similar to how the heart pumps the blood in the whole-body. The ability to integrate multiple peripheral systems seamlessly into your eco-system is extremely advantageous.

These three features are fundamental while evaluating a core Transaction Processing Engine (on-premise or on-cloud) for the success and growth of your business. Feel free to contact me for more information and questions.


About the Author:
Vinay Bhatia is an accomplished Senior Executive and Consultant with more than 20 years of success across the financial services industry. His broad areas of expertise include product development, Agile process optimization, Lending, Line of Credit and consumer loans.

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