The vocabulary of short-term credit
A plain-language glossary of the terms that come up in lending software evaluations — written for the people who have to sit in the meeting, not for search engines.
A
ACH payments
Automated Clearing House — the U.S. bank network used to debit a borrower’s account for scheduled payments and to disburse loan proceeds. QFund originates standard and same-day ACH through integrated processors.
Adverse action
The notice a lender must give when it declines a loan application or offers less favourable terms. Reason codes are retained on the decision record so the notice reflects the actual basis.
Alternative data origination
Credit-relevant information from outside the three national bureaus — bank account behaviour, employment records, telecom and rental data. Central to underwriting borrowers with thin or no traditional file.
API platform
Application programming interface — the documented interface a system exposes so other software can drive it. QFund exposes the operations its own screens perform as RESTful JSON APIs, so a lender can run its own borrower portal or its own agent interface with QFund as the lending core.
APR installment loans
Annual percentage rate — the annualised cost of credit including fees. QFund computes it from loan amount, rate, duration, payment frequency, instalment count, end-of-month handling and next-payment date.
C
CAB cso cab
Credit access business — the Texas registration under which an entity arranges a loan from a third-party lender and provides credit services. Operationally similar to a CSO.
Charge-off collections
The accounting recognition that a balance is unlikely to be collected. It does not extinguish the debt; collections activity and post-judgment payments can continue.
Check21 payments
The U.S. legislation enabling cheques to be cleared as electronic images. Relevant to storefront lenders taking borrower cheques and to check-cashing operations.
Concurrent loan limit payday loans
A state rule capping how many loans a borrower may hold simultaneously, often verified against a mandatory state database during origination.
Cooling-off period payday loans
A state-mandated interval that must pass before a borrower can take a new loan after repaying one. Enforced by QFund at origination rather than checked afterwards.
CSO cso cab
Credit services organisation — a model where the operator provides credit services for a loan held by a third-party lender rather than lending directly. QFund runs normal and CSO loans in one installation.
D
Deferred deposit payday loans
The statutory term used in several states for what the market calls a payday loan — a single-payment advance against a post-dated cheque or ACH authority.
Delinquency collections
The state of being behind on a scheduled payment, measured in days past due and used to drive notices, fees and collections queue placement.
Disbursement payments
Paying loan proceeds to the borrower. QFund supports cash, cheque, debit card, ACH, instant card funding and prepaid load — including multi-disbursal against one loan.
E
Extended payment plan
A statutory repayment arrangement some states require lenders to offer a borrower who cannot repay on the due date. Handled as a configured loan-product behaviour rather than a manual workaround.
F
Fixed-interest method installment loans
Interest calculated on the days between instalment due dates, giving a predictable schedule where each instalment carries a known interest component.
I
Instant card funding payments
Pushing loan proceeds to a borrower’s debit or prepaid card in near real time, rather than waiting for an ACH cycle.
L
Line of credit line of credit
A revolving or non-revolving credit limit a borrower can draw against repeatedly, billed on a statement cycle rather than a fixed instalment schedule.
LMS platform
Loan management system — the platform of record for a loan portfolio, covering origination, servicing, payments, collections and reporting. Distinct from a loan origination system, which handles only the front end.
LOS origination
Loan origination system — software covering loan application through funding, but not the servicing life cycle. In QFund, origination is a suite within the LMS rather than a separate product.
M
MSB check cashing
Money services business — the federal registration category covering check cashing, money transmission and currency exchange, with its own compliance obligations.
Multi-disbursal payments
Funding a single loan through more than one method or in more than one instalment — part cash at the counter, part to a card, for example.
N
NSF payments
Non-sufficient funds — a returned payment. QFund reverses the payment, assesses the permitted fee, updates delinquency state and re-queues the account automatically.
O
Omni-channel solutions
Serving a borrower across storefront, online and mobile against one converged database, so the balance and relationship are identical in every channel.
P
Payoff quote servicing
The amount required to settle a loan on a given date, including interest accrued to that date and any applicable rebate. It must match the ledger and the statement, which is where approximated interest methods cause problems.
POS solutions
Point of sale — in this industry, the storefront application a branch employee uses to transact with a borrower at the counter.
Pro-rate servicing
Apportioning interest or fees across a partial period — necessary when a borrower makes a partial payment part-way through a cycle.
Promise to pay collections
A borrower commitment to pay a stated amount by a stated date, recorded in collections with kept/broken tracking and automatic re-queueing on failure.
R
Rebate installment loans
The portion of pre-computed interest or fees returned to a borrower who repays early. Computed to the day in QFund rather than by table approximation.
Refinance servicing
Replacing an existing loan with a new one, typically to extend the term or advance additional principal. A native transaction in QFund, with the prior loan settled and reconciled as the new one is booked.
Right-party contact collections
Reaching the actual borrower rather than a third party. Tracked per number and channel in collections, because it governs both effectiveness and compliance.
Rollover payday loans
Extending a single-payment loan by paying only fees rather than principal. Restricted or prohibited in many states, so it is enforced by state rule set.
S
Same-as-cash loan types
A promotional retail financing option where no interest is charged if the balance is repaid within a defined window.
Simple-interest method installment loans
Interest accrued on the days between the last payment and the processing date, so early payment reduces total interest and late payment increases it.
SOC 2 Type 2 security
An AICPA examination of the design and operating effectiveness of a service organisation’s controls over a period of time — as distinct from Type 1, which tests design at a point in time. QFund is SOC 2 Type 2 certified.
Storefront industries
A physical branch lending location, as opposed to an online channel. Storefront operations need drawer-level cash control and close-of-day that online ones do not.
T
Title-Track qualification title loans
The constraint that determines the maximum qualified amount on a title / auto-equity loan, derived from vehicle valuation and captured condition.
U
Underwriting matrix origination
The configurable rule set that decides approval, amount and terms — score bands, income multiples, verification requirements and limits by loan product, state and channel.
V
Veritec origination
A provider of mandatory state lending databases used in several states to verify borrower eligibility and concurrent-loan limits at the point of origination.
W
Webhook platform
An HTTP callback the platform sends to a URL you nominate when something happens, so your systems react to an event rather than polling for it. QFund fires webhooks on loan and payment events — application decisioned, loan funded, payment posted, payment returned, promise broken, status changed.
Write-off collections
Removing a balance from the active portfolio for accounting purposes after collections effort is exhausted, while retaining the ability to record post-judgment recovery.
Know the words, then see the system
Most of these terms are things a lending platform either handles properly or approximates. Ask us to show you the difference.