What is a functional requirements template, and how is it different from an RFP checklist?

A checklist confirms that a topic is covered. A functional requirements template goes a level deeper: it lists the specific capability under each topic, lets the lender prioritise it Must / Should / Could, and asks the vendor to respond row by row with evidence. The checklist scopes the RFP; this template scores it.

How should we set Must / Should / Could?

Mark a row Must only if the book cannot run without it on day one. Mark Should if there is a workaround the lender will accept for a quarter or two. Mark Could if it would add value but will not gate the decision. Keeping the Must list honest is what makes the template useful.

Does this template work for an LOS as well as an LMS?

The modules here are LMS-specific: they describe the post-disbursal book. An LOS (Loan Origination System) needs its own requirements for application intake, underwriting, and decisioning. Several modules overlap, though: integrations, roles and permissions, APIs, and deployment apply to both, since the LOS and LMS should sit on one canonical model.

Should a vendor’s "Configurable" answer count the same as "Available"?

No. Ask what configures it. "Configurable" by a business screen or a rule is close to Available. "Configurable" that turns out to mean a billable code change belongs nearer to Roadmap. The distinction is where time-to-launch and total cost of ownership actually live.

Where do regulatory items like RBI penal charges and account aggregator belong?

They are embedded in the relevant modules: penal charges under Charges, account aggregator and NACH under Integrations, returns under Reporting, rather than in a separate compliance module, because they are functional behaviours the book must perform, not paperwork bolted on the side.

Can we add or remove rows?

Yes. This is a starting specification, not a fixed form. Add rows for product lines specific to your book (gold loans, co-lending splits, supply-chain finance) and remove modules you do not operate. Keep the priority column on every row you keep.

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LoktaRevised 2026-08-24

Functional requirements template for a loan management system RFP

A fill-in functional requirements template for the team scoping a Loan Management System RFP. 64 requirements across 11 modules, each with a Must / Should / Could priority column. Set a priority on every row, then ask each vendor to mark every row Available / Configurable / Roadmap / Not supported.

How to use this template

Fill in the priority and notes columns to turn it into your own requirement specification, then send it to each vendor.

Set a priority on every row (Must, Should, or Could) before the template leaves your building.
Use the notes column to record the specific rule, volume, or product nuance behind a row.
Ask each vendor to mark every row Available in platform / Configurable / On roadmap / Not supported, and to add a one-line evidence note.
A "Configurable" answer should name what configures it: a screen, a rule, or a code change.
Score Must rows first; a gap on a Must is a shortlisting decision, not a negotiation.

Priority key. Must = the book cannot run without it. Should = important, with a workaround the lender will accept short-term. Could = valuable, not a gating requirement. Each module below renders as a table: set the priority, capture the vendor response, and use the notes column for the rule or volume behind the row.

Loan product configuration

A loan product is the reusable definition a lender lends against: rate, tenure, charges, and rules. Configuration means changing it without a code release.

Loan product configuration
#	Requirement	Priority
1.1	Configure multiple loan products without code changes	Must
1.2	Multi-currency support (ISO 4217) and per-product currency rules	Should
1.3	Configurable interest methods, flat, declining, flat-to-declining	Must
1.4	Configurable repayment frequency, daily, weekly, monthly, custom	Must
1.5	Product rules variable by tenant, partner, geography, or borrower segment	Should
1.6	Effective-dated, versioned products that retire without disrupting live loans	Should
1.7	Product configuration changes gated by maker-checker and audited	Must

Loan lifecycle and state management

Loan lifecycle and state management
#	Requirement	Priority
2.1	Defined lifecycle states from submission through closure and write-off	Must
2.2	Every state transition recorded in the audit trail with actor and evidence	Must
2.3	Full, partial, and tranche-based disbursement, with cancellation and reversal	Must
2.4	Repayment schedule generation with moratorium and step-up / step-down	Must
2.5	Backdated corrections with audit history and accounting impact preserved	Should
2.6	Co-borrower, guarantor, and party roles maintained against the account	Should

Accounting and ledger

Accounting and ledger
#	Requirement	Priority
3.1	Native accounting events and double-entry journal posting	Must
3.2	GL mapping variable by product, charge, fee, tax, transaction, or branch	Must
3.3	Reversals and corrections that preserve a complete accounting trail	Must
3.4	Reconciliation against bank, payment gateway, UTR, and suspense	Must
3.5	Period-close controls and trial-balance output	Should
3.6	Idempotent posting, a retried transaction posts once, never twice	Must

Idempotent means an operation can be safely retried and still produce a single, correct result: critical when a payment callback arrives twice.

Repayments and collections

Repayments and collections
#	Requirement	Priority
4.1	Configurable allocation across principal, interest, fees, and penalties	Must
4.2	Excess, advance, and suspense handling	Must
4.3	Automatic days-past-due (DPD) calculation	Must
4.4	Configurable delinquency buckets and bucket movement	Must
4.5	Collections queue allocation by product, geography, risk, or DPD stage	Should
4.6	Promises-to-pay tracked end to end	Should
4.7	Settlement approvals gated by maker-checker	Must

Restructuring and foreclosure

Restructuring and foreclosure
#	Requirement	Priority
5.1	Reschedule, refinance, tenure change, and rate change	Must
5.2	Moratorium configuration with schedule recalculation	Should
5.3	Foreclosure quote and full pre-closure with charge calculation	Must
5.4	Pre/post snapshot captured in the audit trail on every restructure	Must
5.5	Write-off lifecycle, prudential and full, with recovery tracking	Must
5.6	Asset classification (standard / sub-standard / doubtful / loss) with configurable DPD thresholds	Must

Charges, fees, and penalties

Charges, fees, and penalties
#	Requirement	Priority
6.1	Origination, late, bounce, and penal charges configurable per product	Must
6.2	Tax handling on charges where applicable	Must
6.3	Waivers and reversals gated by maker-checker	Must
6.4	Penal charges aligned to RBI penal-charges expectations (charge, not capitalised interest)	Must
6.5	Charge schedules effective-dated and versioned	Should

Integrations

Integrations
#	Requirement	Priority
7.1	KYC and identity-verification provider integration	Must
7.2	Credit bureau pull and write-back	Must
7.3	Account aggregator integration for consented financial data	Should
7.4	eSign and e-mandate integration	Must
7.5	Payments, UPI, NACH, and payment-gateway integration	Must
7.6	Core banking bridge, run as system of record or as satellite	Should
7.7	Webhook or event fan-out for downstream systems	Should

An account aggregator (AA) is the RBI-licensed framework that lets a borrower share financial data across institutions with explicit, revocable consent. NACH is the bank-mandate rail for recurring auto-debit.

Reporting and regulatory returns

Reporting and regulatory returns
#	Requirement	Priority
8.1	Portfolio MIS, collections MIS, and arrears reporting	Must
8.2	Operational and disbursement dashboards	Should
8.3	Regulatory returns produced from the system of record	Must
8.4	Configurable reports without a vendor SOW	Should
8.5	Data export for the lender’s own BI and warehouse	Should

Roles and permissions

Roles and permissions
#	Requirement	Priority
9.1	Role-based access control with permission groups	Must
9.2	Organisational hierarchy, branch, region, partner, tenant	Must
9.3	Single sign-on via OIDC / OAuth2 against the lender’s identity provider	Should
9.4	Maker-checker enforced on every policy boundary	Must
9.5	Service-principal accounts for backend integrations, separately governed	Should

APIs and extensibility

APIs and extensibility
#	Requirement	Priority
10.1	Documented API surface (OpenAPI) generated from the platform	Must
10.2	API versioning that ships new versions without breaking existing clients	Must
10.3	Extensibility without a vendor SOW for each change	Should
10.4	Sandbox or non-production environment for integration testing	Must
10.5	Rate limiting, idempotency keys, and webhook retries on the API	Should

Deployment

Deployment
#	Requirement	Priority
11.1	On-premise deployment option	Must
11.2	Deployment inside the lender’s own VPC	Should
11.3	Single-tenant cloud deployment	Should
11.4	Tenant isolation enforced at the database layer, not only the application	Must
11.5	Same binary across deployment topologies, with documented change management	Should

Set a priority on every row

Sixty-plus requirements across eleven modules. Set a priority on every row before it leaves your building; score Must rows first.

Frequently asked questions

Buyer-side answers to the questions a CTO or Head of Digital Lending asks most about turning a requirements template into a scored RFP.

What is a functional requirements template, and how is it different from an RFP checklist?
A checklist confirms that a topic is covered. A functional requirements template goes a level deeper: it lists the specific capability under each topic, lets the lender prioritise it Must / Should / Could, and asks the vendor to respond row by row with evidence. The checklist scopes the RFP; this template scores it.
How should we set Must / Should / Could?
Mark a row Must only if the book cannot run without it on day one. Mark Should if there is a workaround the lender will accept for a quarter or two. Mark Could if it would add value but will not gate the decision. Keeping the Must list honest is what makes the template useful.
Does this template work for an LOS as well as an LMS?
The modules here are LMS-specific: they describe the post-disbursal book. An LOS (Loan Origination System) needs its own requirements for application intake, underwriting, and decisioning. Several modules overlap, though: integrations, roles and permissions, APIs, and deployment apply to both, since the LOS and LMS should sit on one canonical model.
Should a vendor’s "Configurable" answer count the same as "Available"?
No. Ask what configures it. "Configurable" by a business screen or a rule is close to Available. "Configurable" that turns out to mean a billable code change belongs nearer to Roadmap. The distinction is where time-to-launch and total cost of ownership actually live.
Where do regulatory items like RBI penal charges and account aggregator belong?
They are embedded in the relevant modules: penal charges under Charges, account aggregator and NACH under Integrations, returns under Reporting, rather than in a separate compliance module, because they are functional behaviours the book must perform, not paperwork bolted on the side.
Can we add or remove rows?
Yes. This is a starting specification, not a fixed form. Add rows for product lines specific to your book (gold loans, co-lending splits, supply-chain finance) and remove modules you do not operate. Keep the priority column on every row you keep.

How Lokta answers this

Lokta is a Loan Management System (LMS) on a deterministic core and a canonical loan model: one consistent representation of a loan that every module reads and writes. Products, charges, allocation, DPD bands, and asset classification are configured rather than coded; maker-checker gates every policy boundary and the audit trail records every state-change. The API surface is OpenAPI with versioning, and the same binary runs on-prem, in a VPC, or in single-tenant cloud, with tenant isolation at the database layer. A matching origination layer on the same model is a later horizon on the roadmap.

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