FINERACT-2107: Interest Refund - Allocation, Business Event & Full Repayment

2024-10-21 17:36:20 +02:00
parent 84d606552d
commit 5722891477
18 changed files with 969 additions and 77 deletions
@@ -76,7 +76,6 @@ import org.apache.fineract.integrationtests.common.accounting.PeriodicAccrualAcc
 import org.apache.fineract.integrationtests.common.charges.ChargesHelper;
 import org.apache.fineract.integrationtests.common.loans.LoanProductTestBuilder;
 import org.apache.fineract.integrationtests.common.loans.LoanTransactionHelper;
-import org.apache.fineract.portfolio.common.domain.DaysInMonthType;
 import org.apache.fineract.portfolio.loanaccount.domain.transactionprocessor.impl.AdvancedPaymentScheduleTransactionProcessor;
 import org.apache.fineract.portfolio.loanaccount.domain.transactionprocessor.impl.EarlyPaymentLoanRepaymentScheduleTransactionProcessor;
 import org.apache.fineract.portfolio.loanaccount.domain.transactionprocessor.impl.FineractStyleLoanRepaymentScheduleTransactionProcessor;
@@ -4426,7 +4425,7 @@ public class AdvancedPaymentAllocationLoanRepaymentScheduleTest extends BaseLoan
            Long clientId = clientHelper.createClient(ClientHelper.defaultClientCreationRequest()).getClientId();
            PostLoanProductsRequest product = createOnePeriod30DaysLongNoInterestPeriodicAccrualProductWithAdvancedPaymentAllocation()
                    .interestRatePerPeriod(5.0).interestCalculationPeriodType(DAYS).interestRateFrequencyType(YEARS)
-                    .daysInMonthType(DaysInMonthType.DAYS_30.getValue()).daysInYearType(DaysInYearType.DAYS_360).numberOfRepayments(5)//
+                    .daysInMonthType(DaysInMonthType.DAYS_30).daysInYearType(DaysInYearType.DAYS_360).numberOfRepayments(5)//
                    .repaymentEvery(1)//
                    .repaymentFrequencyType(2L)//
                    .enableDownPayment(true)//
@@ -4488,7 +4487,7 @@ public class AdvancedPaymentAllocationLoanRepaymentScheduleTest extends BaseLoan
            Long clientId = clientHelper.createClient(ClientHelper.defaultClientCreationRequest()).getClientId();
            PostLoanProductsRequest product = createOnePeriod30DaysLongNoInterestPeriodicAccrualProductWithAdvancedPaymentAllocation()
                    .interestRatePerPeriod(12.3).interestCalculationPeriodType(RepaymentFrequencyType.DAYS).interestRateFrequencyType(YEARS)
-                    .daysInMonthType(DaysInMonthType.DAYS_30.getValue()).daysInYearType(DaysInYearType.DAYS_360).numberOfRepayments(5)//
+                    .daysInMonthType(DaysInMonthType.DAYS_30).daysInYearType(DaysInYearType.DAYS_360).numberOfRepayments(5)//
                    .repaymentEvery(1)//
                    .repaymentFrequencyType(2L)//
                    .enableDownPayment(true)//
@@ -4551,7 +4550,7 @@ public class AdvancedPaymentAllocationLoanRepaymentScheduleTest extends BaseLoan
            Long clientId = clientHelper.createClient(ClientHelper.defaultClientCreationRequest()).getClientId();
            PostLoanProductsRequest product = createOnePeriod30DaysLongNoInterestPeriodicAccrualProductWithAdvancedPaymentAllocation()
                    .interestRatePerPeriod(12.3).interestCalculationPeriodType(RepaymentFrequencyType.DAYS).interestRateFrequencyType(YEARS)
-                    .daysInMonthType(DaysInMonthType.DAYS_30.getValue()).daysInYearType(DaysInYearType.DAYS_360).numberOfRepayments(5)//
+                    .daysInMonthType(DaysInMonthType.DAYS_30).daysInYearType(DaysInYearType.DAYS_360).numberOfRepayments(5)//
                    .repaymentEvery(1)//
                    .repaymentFrequencyType(2L)//
                    .enableDownPayment(true)//
@@ -4614,7 +4613,7 @@ public class AdvancedPaymentAllocationLoanRepaymentScheduleTest extends BaseLoan
            Long clientId = clientHelper.createClient(ClientHelper.defaultClientCreationRequest()).getClientId();
            PostLoanProductsRequest product = createOnePeriod30DaysLongNoInterestPeriodicAccrualProductWithAdvancedPaymentAllocation()
                    .interestRatePerPeriod(12.3).interestCalculationPeriodType(RepaymentFrequencyType.DAYS).interestRateFrequencyType(YEARS)
-                    .daysInMonthType(DaysInMonthType.ACTUAL.getValue()).daysInYearType(DaysInYearType.DAYS_365).numberOfRepayments(4)//
+                    .daysInMonthType(DaysInMonthType.ACTUAL).daysInYearType(DaysInYearType.DAYS_365).numberOfRepayments(4)//
                    .repaymentEvery(1)//
                    .repaymentFrequencyType(2L)//
                    .allowPartialPeriodInterestCalcualtion(false)//
@@ -4692,8 +4691,8 @@ public class AdvancedPaymentAllocationLoanRepaymentScheduleTest extends BaseLoan
            Long clientId = clientHelper.createClient(ClientHelper.defaultClientCreationRequest()).getClientId();
            PostLoanProductsRequest product = createOnePeriod30DaysLongNoInterestPeriodicAccrualProductWithAdvancedPaymentAllocation()
                    .interestRatePerPeriod(108.0).interestCalculationPeriodType(RepaymentFrequencyType.DAYS)
-                    .interestRateFrequencyType(YEARS).daysInMonthType(DaysInMonthType.ACTUAL.getValue())
-                    .daysInYearType(DaysInYearType.DAYS_360).numberOfRepayments(4)//
+                    .interestRateFrequencyType(YEARS).daysInMonthType(DaysInMonthType.ACTUAL).daysInYearType(DaysInYearType.DAYS_360)
+                    .numberOfRepayments(4)//
                    .maxInterestRatePerPeriod((double) 110)//
                    .repaymentEvery(1)//
                    .repaymentFrequencyType(1L)//
@@ -4873,7 +4872,7 @@ public class AdvancedPaymentAllocationLoanRepaymentScheduleTest extends BaseLoan
            interestRefundTypes.add("MERCHANT_ISSUED_REFUND");
            PostLoanProductsRequest product = createOnePeriod30DaysLongNoInterestPeriodicAccrualProductWithAdvancedPaymentAllocation()
                    .interestRatePerPeriod(12.0).interestCalculationPeriodType(RepaymentFrequencyType.DAYS).interestRateFrequencyType(YEARS)
-                    .daysInMonthType(DaysInMonthType.ACTUAL.getValue()).daysInYearType(DaysInYearType.DAYS_365).numberOfRepayments(4)//
+                    .daysInMonthType(DaysInMonthType.ACTUAL).daysInYearType(DaysInYearType.DAYS_365).numberOfRepayments(4)//
                    .repaymentEvery(5)//
                    .repaymentFrequencyType(0L)//
                    .allowPartialPeriodInterestCalcualtion(false)//
@@ -4935,8 +4934,8 @@ public class AdvancedPaymentAllocationLoanRepaymentScheduleTest extends BaseLoan
            Long clientId = clientHelper.createClient(ClientHelper.defaultClientCreationRequest()).getClientId();
            PostLoanProductsRequest product = createOnePeriod30DaysLongNoInterestPeriodicAccrualProductWithAdvancedPaymentAllocation()
                    .interestRatePerPeriod(interestRatePerPeriod.doubleValue()).interestCalculationPeriodType(RepaymentFrequencyType.DAYS)
-                    .interestRateFrequencyType(YEARS).daysInMonthType(DaysInMonthType.DAYS_30.getValue())
-                    .daysInYearType(DaysInYearType.DAYS_360).numberOfRepayments(6)//
+                    .interestRateFrequencyType(YEARS).daysInMonthType(DaysInMonthType.DAYS_30).daysInYearType(DaysInYearType.DAYS_360)
+                    .numberOfRepayments(6)//
                    .repaymentEvery(1)//
                    .repaymentFrequencyType(2L)//
                    .enableDownPayment(false)//
@@ -5017,8 +5016,8 @@ public class AdvancedPaymentAllocationLoanRepaymentScheduleTest extends BaseLoan
            Long clientId = clientHelper.createClient(ClientHelper.defaultClientCreationRequest()).getClientId();
            PostLoanProductsRequest product = createOnePeriod30DaysLongNoInterestPeriodicAccrualProductWithAdvancedPaymentAllocation()
                    .interestRatePerPeriod(interestRatePerPeriod.doubleValue()).interestCalculationPeriodType(RepaymentFrequencyType.DAYS)
-                    .interestRateFrequencyType(YEARS).daysInMonthType(DaysInMonthType.DAYS_30.getValue())
-                    .daysInYearType(DaysInYearType.DAYS_360).numberOfRepayments(6)//
+                    .interestRateFrequencyType(YEARS).daysInMonthType(DaysInMonthType.DAYS_30).daysInYearType(DaysInYearType.DAYS_360)
+                    .numberOfRepayments(6)//
                    .repaymentEvery(1)//
                    .repaymentFrequencyType(2L)//
                    .enableDownPayment(false)//
@@ -5114,7 +5113,7 @@ public class AdvancedPaymentAllocationLoanRepaymentScheduleTest extends BaseLoan
                    .interestRatePerPeriod(interestRatePerPeriod.doubleValue())//
                    .interestCalculationPeriodType(RepaymentFrequencyType.DAYS)//
                    .interestRateFrequencyType(YEARS)//
-                    .daysInMonthType(DaysInMonthType.DAYS_30.getValue())//
+                    .daysInMonthType(DaysInMonthType.DAYS_30)//
                    .daysInYearType(DaysInYearType.DAYS_360)//
                    .numberOfRepayments(6)//
                    .repaymentEvery(1)//
@@ -1281,6 +1281,13 @@ public abstract class BaseLoanIntegrationTest {
        public static final Integer DAYS_365 = 365;
    }

+    public static class DaysInMonthType {
+
+        public static final Integer INVALID = 0;
+        public static final Integer ACTUAL = 1;
+        public static final Integer DAYS_30 = 30;
+    }
+
    public static class FuturePaymentAllocationRule {

        public static final String LAST_INSTALLMENT = "LAST_INSTALLMENT";
@@ -25,9 +25,11 @@ import io.restassured.builder.ResponseSpecBuilder;
 import io.restassured.http.ContentType;
 import io.restassured.specification.RequestSpecification;
 import io.restassured.specification.ResponseSpecification;
+import jakarta.validation.constraints.NotNull;
 import java.math.BigDecimal;
 import java.time.LocalDate;
 import java.time.format.DateTimeFormatter;
+import java.util.ArrayList;
 import java.util.List;
 import java.util.Locale;
 import java.util.Map;
@@ -35,6 +37,8 @@ import java.util.Objects;
 import java.util.concurrent.atomic.AtomicReference;
 import lombok.AllArgsConstructor;
 import lombok.Data;
+import lombok.EqualsAndHashCode;
+import lombok.NoArgsConstructor;
 import lombok.extern.slf4j.Slf4j;
 import org.apache.commons.collections4.CollectionUtils;
 import org.apache.commons.lang3.StringUtils;
@@ -42,6 +46,8 @@ import org.apache.fineract.client.models.PostClientsResponse;
 import org.apache.fineract.client.models.PostCreateRescheduleLoansRequest;
 import org.apache.fineract.client.models.PostCreateRescheduleLoansResponse;
 import org.apache.fineract.client.models.PostLoanProductsRequest;
+import org.apache.fineract.client.models.PostLoanProductsResponse;
+import org.apache.fineract.client.models.PostLoansLoanIdTransactionsResponse;
 import org.apache.fineract.client.models.PostLoansRequest;
 import org.apache.fineract.client.models.PostUpdateRescheduleLoansRequest;
 import org.apache.fineract.infrastructure.event.external.service.validation.ExternalEventDTO;
@@ -111,7 +117,7 @@ public class ExternalBusinessEventTest extends BaseLoanIntegrationTest {

            loanTransactionHelper.makeLoanRepayment("15 March 2023", 125.0F, loanIdRef.get().intValue());

-            verifyBusinessEvents(new BusinessEvent("LoanBalanceChangedBusinessEvent", "15 March 2023", 300, 400.0, 291.04));
+            verifyBusinessEvents(new LoanBusinessEvent("LoanBalanceChangedBusinessEvent", "15 March 2023", 300, 400.0, 291.04));
        });
        runAt("1 April 2023", () -> {

@@ -123,7 +129,7 @@ public class ExternalBusinessEventTest extends BaseLoanIntegrationTest {

            loanTransactionHelper.makeLoanRepayment("15 April 2023", 125.0F, loanIdRef.get().intValue());

-            verifyBusinessEvents(new BusinessEvent("LoanBalanceChangedBusinessEvent", "15 April 2023", 300, 1000.0, 770.06));
+            verifyBusinessEvents(new LoanBusinessEvent("LoanBalanceChangedBusinessEvent", "15 April 2023", 300, 1000.0, 770.06));

            deleteAllExternalEvents();

@@ -131,24 +137,57 @@ public class ExternalBusinessEventTest extends BaseLoanIntegrationTest {
                    .getResourceId();
            Assertions.assertNotNull(transactionId);

-            verifyBusinessEvents(new BusinessEvent("LoanBalanceChangedBusinessEvent", "15 April 2023", 700, 1000.0, 0.0));
+            verifyBusinessEvents(new LoanBusinessEvent("LoanBalanceChangedBusinessEvent", "15 April 2023", 700, 1000.0, 0.0));

            deleteAllExternalEvents();

            loanTransactionHelper.reverseRepayment(loanIdRef.get().intValue(), transactionId.intValue(), "15 April 2023");

-            verifyBusinessEvents(new BusinessEvent("LoanBalanceChangedBusinessEvent", "15 April 2023", 300, 1000.0, 770.06));
+            verifyBusinessEvents(new LoanBusinessEvent("LoanBalanceChangedBusinessEvent", "15 April 2023", 300, 1000.0, 770.06));

            deleteAllExternalEvents();

            loanTransactionHelper.makeLoanRepayment("15 April 2023", 830.22F, loanIdRef.get().intValue());

-            verifyBusinessEvents(new BusinessEvent("LoanBalanceChangedBusinessEvent", "15 April 2023", 600, 1000.0, 0.0));
+            verifyBusinessEvents(new LoanBusinessEvent("LoanBalanceChangedBusinessEvent", "15 April 2023", 600, 1000.0, 0.0));

            disableLoanBalanceChangedBusinessEvent();
        });
    }

+    @Test
+    public void verifyInterestRefundPostBusinessEventCreatedForMerchantIssuedRefundWithInterestRefund() {
+        AtomicReference<Long> loanIdRef = new AtomicReference<>();
+        enableLoanInterestRefundPstBusinessEvent(true);
+        runAt("1 January 2021", () -> {
+            PostLoanProductsResponse loanProduct = loanProductHelper
+                    .createLoanProduct(create4IProgressive().daysInMonthType(DaysInMonthType.ACTUAL) //
+                            .daysInYearType(DaysInYearType.ACTUAL) //
+                            .supportedInterestRefundTypes(new ArrayList<>()).addSupportedInterestRefundTypesItem("MERCHANT_ISSUED_REFUND") //
+                            .recalculationRestFrequencyType(RecalculationRestFrequencyType.DAILY) //
+            );
+            Long loanId = applyAndApproveProgressiveLoan(client.getClientId(), loanProduct.getResourceId(), "1 January 2021", 1000.0, 9.99,
+                    12, null);
+            Assertions.assertNotNull(loanId);
+            loanIdRef.set(loanId);
+            disburseLoan(loanId, BigDecimal.valueOf(1000), "1 January 2021");
+        });
+        runAt("22 January 2021", () -> {
+            Long loanId = loanIdRef.get();
+
+            deleteAllExternalEvents();
+
+            PostLoansLoanIdTransactionsResponse postLoansLoanIdTransactionsResponse = loanTransactionHelper
+                    .makeLoanRepayment("MerchantIssuedRefund", "22 January 2021", 1000F, loanId.intValue());
+            Assertions.assertNotNull(postLoansLoanIdTransactionsResponse);
+            Assertions.assertNotNull(postLoansLoanIdTransactionsResponse.getResourceId());
+
+            verifyBusinessEvents(new LoanTransactionBusinessEvent("LoanTransactionInterestRefundPostBusinessEvent", "22 January 2021", 5.75,
+                    994.25, 5.75, 0.0, 0.0, 0.0));
+        });
+        enableLoanInterestRefundPstBusinessEvent(false);
+    }
+
    @Test
    public void testExternalBusinessEventLoanRescheduledDueAdjustScheduleBusinessEventInterestChange() {
        AtomicReference<Long> loanIdRef = new AtomicReference<>();
@@ -171,7 +210,7 @@ public class ExternalBusinessEventTest extends BaseLoanIntegrationTest {
            loanRescheduleRequestHelper.approveLoanRescheduleRequest(rescheduleLoansResponse.getResourceId(),
                    new PostUpdateRescheduleLoansRequest().approvedOnDate("1 March 2024").locale("en").dateFormat(DATETIME_PATTERN));

-            verifyBusinessEvents(new BusinessEvent("LoanRescheduledDueAdjustScheduleBusinessEvent", "01 March 2024", 300, 400.0, 400.0,
+            verifyBusinessEvents(new LoanBusinessEvent("LoanRescheduledDueAdjustScheduleBusinessEvent", "01 March 2024", 300, 400.0, 400.0,
                    List.of("interestRateForInstallment")));
        });
    }
@@ -260,11 +299,28 @@ public class ExternalBusinessEventTest extends BaseLoanIntegrationTest {

    private void logBusinessEvents(List<ExternalEventDTO> allExternalEvents) {
        allExternalEvents.forEach(externalEventDTO -> {
-            log.info("Event Received { type:'{}' businessDate:'{}' }", externalEventDTO.getType(), externalEventDTO.getBusinessDate());
-            log.debug(externalEventDTO.toString());
+            Object amount = externalEventDTO.getPayLoad().get("amount");
+            Object outstandingLoanBalance = externalEventDTO.getPayLoad().get("outstandingLoanBalance");
+            Object principalPortion = externalEventDTO.getPayLoad().get("principalPortion");
+            Object interestPortion = externalEventDTO.getPayLoad().get("interestPortion");
+            Object feePortion = externalEventDTO.getPayLoad().get("feeChargesPortion");
+            Object penaltyPortion = externalEventDTO.getPayLoad().get("penaltyChargesPortion");
+            log.info("Event Received\n type:'{}'\n businessDate:'{}'", externalEventDTO.getType(), externalEventDTO.getBusinessDate());
+            log.info(
+                    "Values\n amount: {}\n outstandingLoanBalance: {}\n principalPortion: {}\n interestPortion: {}\n feePortion: {}\n penaltyPortion: {}",
+                    amount, outstandingLoanBalance, principalPortion, interestPortion, feePortion, penaltyPortion);
        });
    }

+    private static void enableLoanInterestRefundPstBusinessEvent(boolean enabled) {
+        final Map<String, Boolean> updatedConfigurations = ExternalEventConfigurationHelper.updateExternalEventConfigurations(requestSpec,
+                responseSpec, "{\"externalEventConfigurations\":{\"LoanTransactionInterestRefundPostBusinessEvent\":"
+                        + (enabled ? "true" : "false") + "}}\n");
+        Assertions.assertEquals(updatedConfigurations.size(), 1);
+        Assertions.assertTrue(updatedConfigurations.containsKey("LoanTransactionInterestRefundPostBusinessEvent"));
+        Assertions.assertEquals(enabled, updatedConfigurations.get("LoanTransactionInterestRefundPostBusinessEvent"));
+    }
+
    public void verifyBusinessEvents(BusinessEvent... businessEvents) {
        List<ExternalEventDTO> allExternalEvents = ExternalEventHelper.getAllExternalEvents(requestSpec, responseSpec);
        logBusinessEvents(allExternalEvents);
@@ -273,61 +329,119 @@ public class ExternalBusinessEventTest extends BaseLoanIntegrationTest {
        Assertions.assertTrue(businessEvents.length <= allExternalEvents.size(),
                "Expected business event count is less than actual. Expected: " + businessEvents.length + " Actual: "
                        + allExternalEvents.size());
-        DateTimeFormatter formatter = DateTimeFormatter.ofPattern(DATETIME_PATTERN, Locale.ENGLISH);
+        final DateTimeFormatter formatter = DateTimeFormatter.ofPattern(DATETIME_PATTERN, Locale.ENGLISH);
        for (BusinessEvent businessEvent : businessEvents) {
-            long count = allExternalEvents.stream().filter(externalEvent -> {
-                Object summaryRes = externalEvent.getPayLoad().get("summary");
-                Object statusRes = externalEvent.getPayLoad().get("status");
-                Map<String, Object> summary = summaryRes instanceof Map ? (Map<String, Object>) summaryRes : Map.of();
-                Map<String, Object> status = statusRes instanceof Map ? (Map<String, Object>) statusRes : Map.of();
-                var principalDisbursed = summary.get("principalDisbursed");
-
-                var principalOutstanding = summary.get("principalOutstanding");
-                var businessDate = LocalDate.parse(businessEvent.getBusinessDate(), formatter);
-                Double statusId = (Double) status.get("id");
-                return Objects.equals(externalEvent.getType(), businessEvent.getType())
-                        && Objects.equals(externalEvent.getBusinessDate(), businessDate)
-                        && Objects.equals(statusId, businessEvent.getStatusId().doubleValue())
-                        && Objects.equals(principalDisbursed, businessEvent.getPrincipalDisbursed())
-                        && Objects.equals(principalOutstanding, businessEvent.getPrincipalOutstanding())
-                        && loanTermVariationsMatch((List<Map<String, Object>>) externalEvent.getPayLoad().get("loanTermVariations"),
-                                businessEvent.loanTermVariationType);
-            }).count();
+            long count = allExternalEvents.stream().filter(externalEvent -> businessEvent.verify(externalEvent, formatter)).count();
            Assertions.assertEquals(1, count, "Expected business event not found " + businessEvent);
        }
    }

-    private boolean loanTermVariationsMatch(final List<Map<String, Object>> loanTermVariations, final List<String> expectedTypes) {
-        if (CollectionUtils.isEmpty(expectedTypes)) {
-            return true;
-        }
-        final long numberOfMatches = expectedTypes
-                .stream().filter(
-                        expectedType -> loanTermVariations.stream()
-                                .anyMatch(variation -> StringUtils
-                                        .equals((String) ((Map<String, Object>) variation.get("termType")).get("value"), expectedType)))
-                .count();
-
-        return numberOfMatches == expectedTypes.size();
-    }
-
    @Data
    @AllArgsConstructor
+    @NoArgsConstructor
    public static class BusinessEvent {

-        public BusinessEvent(String type, String businessDate, Integer statusId, Double principalDisbursed, Double principalOutstanding) {
-            this.type = type;
-            this.businessDate = businessDate;
+        String type;
+        String businessDate;
+
+        boolean verify(@NotNull ExternalEventDTO externalEvent, DateTimeFormatter formatter) {
+            var businessDate = LocalDate.parse(getBusinessDate(), formatter);
+
+            return Objects.equals(externalEvent.getType(), getType()) && Objects.equals(externalEvent.getBusinessDate(), businessDate);
+        }
+    }
+
+    @EqualsAndHashCode(callSuper = true)
+    @Data
+    @AllArgsConstructor
+    public static class LoanTransactionBusinessEvent extends BusinessEvent {
+
+        private Double amount;
+        private Double outstandingLoanBalance;
+        private Double principalPortion;
+        private Double interestPortion;
+        private Double feeChargesPortion;
+        private Double penaltyChargesPortion;
+
+        public LoanTransactionBusinessEvent(String type, String businessDate, Double amount, Double outstandingLoanBalance,
+                Double principalPortion, Double interestPortion, Double feeChargesPortion, Double penaltyChargesPortion) {
+            super(type, businessDate);
+            this.amount = amount;
+            this.outstandingLoanBalance = outstandingLoanBalance;
+            this.principalPortion = principalPortion;
+            this.interestPortion = interestPortion;
+            this.feeChargesPortion = feeChargesPortion;
+            this.penaltyChargesPortion = penaltyChargesPortion;
+        }
+
+        @Override
+        boolean verify(ExternalEventDTO externalEvent, DateTimeFormatter formatter) {
+            Object amount = externalEvent.getPayLoad().get("amount");
+            Object outstandingLoanBalance = externalEvent.getPayLoad().get("outstandingLoanBalance");
+            Object principalPortion = externalEvent.getPayLoad().get("principalPortion");
+            Object interestPortion = externalEvent.getPayLoad().get("interestPortion");
+            Object feePortion = externalEvent.getPayLoad().get("feeChargesPortion");
+            Object penaltyPortion = externalEvent.getPayLoad().get("penaltyChargesPortion");
+
+            return super.verify(externalEvent, formatter) && Objects.equals(amount, getAmount())
+                    && Objects.equals(outstandingLoanBalance, getOutstandingLoanBalance())
+                    && Objects.equals(principalPortion, getPrincipalPortion()) && Objects.equals(interestPortion, getInterestPortion())
+                    && Objects.equals(feePortion, getFeeChargesPortion()) && Objects.equals(penaltyPortion, getPenaltyChargesPortion());
+        }
+    }
+
+    @EqualsAndHashCode(callSuper = true)
+    @Data
+    @AllArgsConstructor
+    public static class LoanBusinessEvent extends BusinessEvent {
+
+        private Integer statusId;
+        private Double principalDisbursed;
+        private Double principalOutstanding;
+        private List<String> loanTermVariationType;
+
+        public LoanBusinessEvent(String type, String businessDate, Integer statusId, Double principalDisbursed,
+                Double principalOutstanding) {
+            super(type, businessDate);
            this.statusId = statusId;
            this.principalDisbursed = principalDisbursed;
            this.principalOutstanding = principalOutstanding;
        }

-        private String type;
-        private String businessDate;
-        private Integer statusId;
-        private Double principalDisbursed;
-        private Double principalOutstanding;
-        private List<String> loanTermVariationType;
+        public LoanBusinessEvent(String type, String businessDate, Integer statusId, Double principalDisbursed, Double principalOutstanding,
+                List<String> loanTermVariationType) {
+            super(type, businessDate);
+            this.statusId = statusId;
+            this.principalDisbursed = principalDisbursed;
+            this.principalOutstanding = principalOutstanding;
+            this.loanTermVariationType = loanTermVariationType;
+        }
+
+        @Override
+        public boolean verify(ExternalEventDTO externalEvent, DateTimeFormatter formatter) {
+            Object summaryRes = externalEvent.getPayLoad().get("summary");
+            Object statusRes = externalEvent.getPayLoad().get("status");
+            Map<String, Object> summary = summaryRes instanceof Map ? (Map<String, Object>) summaryRes : Map.of();
+            Map<String, Object> status = statusRes instanceof Map ? (Map<String, Object>) statusRes : Map.of();
+            var principalDisbursed = summary.get("principalDisbursed");
+
+            var principalOutstanding = summary.get("principalOutstanding");
+            Double statusId = (Double) status.get("id");
+            return super.verify(externalEvent, formatter) && Objects.equals(statusId, getStatusId().doubleValue())
+                    && Objects.equals(principalDisbursed, getPrincipalDisbursed())
+                    && Objects.equals(principalOutstanding, getPrincipalOutstanding()) && loanTermVariationsMatch(
+                            (List<Map<String, Object>>) externalEvent.getPayLoad().get("loanTermVariations"), loanTermVariationType);
+        }
+
+        private boolean loanTermVariationsMatch(final List<Map<String, Object>> loanTermVariations, final List<String> expectedTypes) {
+            if (CollectionUtils.isEmpty(expectedTypes)) {
+                return true;
+            }
+            final long numberOfMatches = expectedTypes.stream().filter(expectedType -> loanTermVariations.stream().anyMatch(
+                    variation -> StringUtils.equals((String) ((Map<String, Object>) variation.get("termType")).get("value"), expectedType)))
+                    .count();
+
+            return numberOfMatches == expectedTypes.size();
+        }
    }
 }
@@ -0,0 +1,412 @@
+/**
+ * Licensed to the Apache Software Foundation (ASF) under one
+ * or more contributor license agreements. See the NOTICE file
+ * distributed with this work for additional information
+ * regarding copyright ownership. The ASF licenses this file
+ * to you under the Apache License, Version 2.0 (the
+ * "License"); you may not use this file except in compliance
+ * with the License. You may obtain a copy of the License at
+ *
+ * http://www.apache.org/licenses/LICENSE-2.0
+ *
+ * Unless required by applicable law or agreed to in writing,
+ * software distributed under the License is distributed on an
+ * "AS IS" BASIS, WITHOUT WARRANTIES OR CONDITIONS OF ANY
+ * KIND, either express or implied. See the License for the
+ * specific language governing permissions and limitations
+ * under the License.
+ */
+package org.apache.fineract.integrationtests;
+
+import io.restassured.builder.RequestSpecBuilder;
+import io.restassured.builder.ResponseSpecBuilder;
+import io.restassured.http.ContentType;
+import io.restassured.specification.RequestSpecification;
+import io.restassured.specification.ResponseSpecification;
+import java.math.BigDecimal;
+import java.util.ArrayList;
+import java.util.concurrent.atomic.AtomicReference;
+import lombok.extern.slf4j.Slf4j;
+import org.apache.fineract.client.models.GetLoansLoanIdResponse;
+import org.apache.fineract.client.models.PostClientsResponse;
+import org.apache.fineract.client.models.PostLoanProductsResponse;
+import org.apache.fineract.client.models.PostLoansLoanIdTransactionsResponse;
+import org.apache.fineract.integrationtests.common.BusinessStepHelper;
+import org.apache.fineract.integrationtests.common.ClientHelper;
+import org.apache.fineract.integrationtests.common.Utils;
+import org.apache.fineract.integrationtests.common.loans.LoanTransactionHelper;
+import org.junit.jupiter.api.Assertions;
+import org.junit.jupiter.api.BeforeAll;
+import org.junit.jupiter.api.Test;
+
+@Slf4j
+public class LoanInterestRefundTest extends BaseLoanIntegrationTest {
+
+    private static ResponseSpecification responseSpec;
+    private static RequestSpecification requestSpec;
+    private static LoanTransactionHelper loanTransactionHelper;
+    private static PostClientsResponse client;
+    private static BusinessStepHelper businessStepHelper;
+
+    @BeforeAll
+    public static void setup() {
+        Utils.initializeRESTAssured();
+        requestSpec = new RequestSpecBuilder().setContentType(ContentType.JSON).build();
+        requestSpec.header("Authorization", "Basic " + Utils.loginIntoServerAndGetBase64EncodedAuthenticationKey());
+        requestSpec.header("Fineract-Platform-TenantId", "default");
+        responseSpec = new ResponseSpecBuilder().expectStatusCode(200).build();
+        loanTransactionHelper = new LoanTransactionHelper(requestSpec, responseSpec);
+        ClientHelper clientHelper = new ClientHelper(requestSpec, responseSpec);
+        client = clientHelper.createClient(ClientHelper.defaultClientCreationRequest());
+    }
+
+    @Test
+    public void verifyInterestRefundNotCreatedForPayoutRefundWhenTypesAreEmpty() {
+        AtomicReference<Long> loanIdRef = new AtomicReference<>();
+        runAt("1 January 2021", () -> {
+            PostLoanProductsResponse loanProduct = loanProductHelper
+                    .createLoanProduct(create4IProgressive().daysInMonthType(DaysInMonthType.ACTUAL) //
+                            .daysInYearType(DaysInYearType.ACTUAL) //
+                            .supportedInterestRefundTypes(new ArrayList<>()) //
+                            .recalculationRestFrequencyType(RecalculationRestFrequencyType.DAILY) //
+            );
+            Long loanId = applyAndApproveProgressiveLoan(client.getClientId(), loanProduct.getResourceId(), "1 January 2021", 1000.0, 9.9,
+                    12, null);
+            Assertions.assertNotNull(loanId);
+            loanIdRef.set(loanId);
+            disburseLoan(loanId, BigDecimal.valueOf(1000), "1 January 2021");
+        });
+        runAt("22 January 2021", () -> {
+            Long loanId = loanIdRef.get();
+            PostLoansLoanIdTransactionsResponse postLoansLoanIdTransactionsResponse = loanTransactionHelper
+                    .makeLoanRepayment("PayoutRefund", "22 January 2021", 1000F, loanId.intValue());
+            Assertions.assertNotNull(postLoansLoanIdTransactionsResponse);
+            Assertions.assertNotNull(postLoansLoanIdTransactionsResponse.getResourceId());
+
+            logTransactions(loanId);
+            verifyTransactions(loanId, transaction(1000.0, "Disbursement", "01 January 2021"),
+                    transaction(1000.0, "Payout Refund", "22 January 2021"));
+        });
+    }
+
+    @Test
+    public void verifyInterestRefundNotCreatedForMerchantIssuedRefundWhenTypesAreEmpty() {
+        AtomicReference<Long> loanIdRef = new AtomicReference<>();
+        runAt("1 January 2021", () -> {
+            PostLoanProductsResponse loanProduct = loanProductHelper
+                    .createLoanProduct(create4IProgressive().daysInMonthType(DaysInMonthType.ACTUAL) //
+                            .daysInYearType(DaysInYearType.ACTUAL) //
+                            .supportedInterestRefundTypes(new ArrayList<>())//
+                            .recalculationRestFrequencyType(RecalculationRestFrequencyType.DAILY) //
+            );
+            Long loanId = applyAndApproveProgressiveLoan(client.getClientId(), loanProduct.getResourceId(), "1 January 2021", 1000.0, 9.9,
+                    12, null);
+            Assertions.assertNotNull(loanId);
+            loanIdRef.set(loanId);
+            disburseLoan(loanId, BigDecimal.valueOf(1000), "1 January 2021");
+        });
+        runAt("22 January 2021", () -> {
+            Long loanId = loanIdRef.get();
+            PostLoansLoanIdTransactionsResponse postLoansLoanIdTransactionsResponse = loanTransactionHelper
+                    .makeLoanRepayment("MerchantIssuedRefund", "22 January 2021", 1000F, loanId.intValue());
+            Assertions.assertNotNull(postLoansLoanIdTransactionsResponse);
+            Assertions.assertNotNull(postLoansLoanIdTransactionsResponse.getResourceId());
+
+            logTransactions(loanId);
+            verifyTransactions(loanId, transaction(1000.0, "Disbursement", "01 January 2021"),
+                    transaction(1000.0, "Merchant Issued Refund", "22 January 2021"));
+        });
+    }
+
+    @Test
+    public void verifyInterestRefundCreatedForPayoutRefund() {
+        AtomicReference<Long> loanIdRef = new AtomicReference<>();
+        runAt("1 January 2021", () -> {
+            PostLoanProductsResponse loanProduct = loanProductHelper
+                    .createLoanProduct(create4IProgressive().daysInMonthType(DaysInMonthType.ACTUAL) //
+                            .daysInYearType(DaysInYearType.ACTUAL) //
+                            .supportedInterestRefundTypes(new ArrayList<>()).addSupportedInterestRefundTypesItem("PAYOUT_REFUND") //
+                            .recalculationRestFrequencyType(RecalculationRestFrequencyType.DAILY) //
+            );
+            Long loanId = applyAndApproveProgressiveLoan(client.getClientId(), loanProduct.getResourceId(), "1 January 2021", 1000.0, 9.99,
+                    12, null);
+            Assertions.assertNotNull(loanId);
+            loanIdRef.set(loanId);
+            disburseLoan(loanId, BigDecimal.valueOf(1000), "1 January 2021");
+        });
+        runAt("22 January 2021", () -> {
+            Long loanId = loanIdRef.get();
+            PostLoansLoanIdTransactionsResponse postLoansLoanIdTransactionsResponse = loanTransactionHelper
+                    .makeLoanRepayment("PayoutRefund", "22 January 2021", 1000F, loanId.intValue());
+            Assertions.assertNotNull(postLoansLoanIdTransactionsResponse);
+            Assertions.assertNotNull(postLoansLoanIdTransactionsResponse.getResourceId());
+
+            logTransactions(loanId);
+            verifyTransactions(loanId, transaction(1000.0, "Disbursement", "01 January 2021"),
+                    transaction(1000.0, "Payout Refund", "22 January 2021"), transaction(5.75, "Accrual", "22 January 2021"),
+                    transaction(5.75, "Interest Refund", "22 January 2021"));
+        });
+    }
+
+    @Test
+    public void verifyInterestRefundCreatedForMerchantIssuedRefund() {
+        AtomicReference<Long> loanIdRef = new AtomicReference<>();
+        runAt("1 January 2021", () -> {
+            PostLoanProductsResponse loanProduct = loanProductHelper
+                    .createLoanProduct(create4IProgressive().daysInMonthType(DaysInMonthType.ACTUAL) //
+                            .daysInYearType(DaysInYearType.ACTUAL) //
+                            .supportedInterestRefundTypes(new ArrayList<>()).addSupportedInterestRefundTypesItem("MERCHANT_ISSUED_REFUND") //
+                            .recalculationRestFrequencyType(RecalculationRestFrequencyType.DAILY) //
+            );
+            Long loanId = applyAndApproveProgressiveLoan(client.getClientId(), loanProduct.getResourceId(), "1 January 2021", 1000.0, 9.99,
+                    12, null);
+            Assertions.assertNotNull(loanId);
+            loanIdRef.set(loanId);
+            disburseLoan(loanId, BigDecimal.valueOf(1000), "1 January 2021");
+        });
+        runAt("22 January 2021", () -> {
+            Long loanId = loanIdRef.get();
+            PostLoansLoanIdTransactionsResponse postLoansLoanIdTransactionsResponse = loanTransactionHelper
+                    .makeLoanRepayment("MerchantIssuedRefund", "22 January 2021", 1000F, loanId.intValue());
+            Assertions.assertNotNull(postLoansLoanIdTransactionsResponse);
+            Assertions.assertNotNull(postLoansLoanIdTransactionsResponse.getResourceId());
+
+            logTransactions(loanId);
+            verifyTransactions(loanId, transaction(1000.0, "Disbursement", "01 January 2021"),
+                    transaction(1000.0, "Merchant Issued Refund", "22 January 2021"), transaction(5.75, "Accrual", "22 January 2021"),
+                    transaction(5.75, "Interest Refund", "22 January 2021"));
+        });
+    }
+
+    @Test
+    public void verifyUC01() {
+        AtomicReference<Long> loanIdRef = new AtomicReference<>();
+        runAt("1 January 2021", () -> {
+            PostLoanProductsResponse loanProduct = loanProductHelper
+                    .createLoanProduct(create4IProgressive().daysInMonthType(DaysInMonthType.ACTUAL) //
+                            .daysInYearType(DaysInYearType.ACTUAL) //
+                            .supportedInterestRefundTypes(new ArrayList<>()).addSupportedInterestRefundTypesItem("PAYOUT_REFUND") //
+                            .addSupportedInterestRefundTypesItem("MERCHANT_ISSUED_REFUND") //
+                            .recalculationRestFrequencyType(RecalculationRestFrequencyType.DAILY) //
+            );
+            Long loanId = applyAndApproveProgressiveLoan(client.getClientId(), loanProduct.getResourceId(), "1 January 2021", 1000.0, 9.99,
+                    12, null);
+            Assertions.assertNotNull(loanId);
+            loanIdRef.set(loanId);
+            disburseLoan(loanId, BigDecimal.valueOf(1000), "1 January 2021");
+        });
+        runAt("22 January 2021", () -> {
+            Long loanId = loanIdRef.get();
+            PostLoansLoanIdTransactionsResponse postLoansLoanIdTransactionsResponse = loanTransactionHelper
+                    .makeLoanRepayment("PayoutRefund", "22 January 2021", 1000F, loanId.intValue());
+            Assertions.assertNotNull(postLoansLoanIdTransactionsResponse);
+            Assertions.assertNotNull(postLoansLoanIdTransactionsResponse.getResourceId());
+
+            logTransactions(loanId);
+            verifyTransactions(loanId, transaction(1000.0, "Disbursement", "01 January 2021"),
+                    transaction(1000.0, "Payout Refund", "22 January 2021"), transaction(5.75, "Accrual", "22 January 2021"),
+                    transaction(5.75, "Interest Refund", "22 January 2021"));
+        });
+    }
+
+    @Test
+    public void verifyUC02a() {
+        AtomicReference<Long> loanIdRef = new AtomicReference<>();
+        runAt("1 January 2021", () -> {
+            PostLoanProductsResponse loanProduct = loanProductHelper
+                    .createLoanProduct(create4IProgressive().daysInMonthType(DaysInMonthType.ACTUAL) //
+                            .daysInYearType(DaysInYearType.ACTUAL) //
+                            .supportedInterestRefundTypes(new ArrayList<>()).addSupportedInterestRefundTypesItem("PAYOUT_REFUND") //
+                            .addSupportedInterestRefundTypesItem("MERCHANT_ISSUED_REFUND") //
+                            .recalculationRestFrequencyType(RecalculationRestFrequencyType.DAILY) //
+            );
+            Long loanId = applyAndApproveProgressiveLoan(client.getClientId(), loanProduct.getResourceId(), "1 January 2021", 1000.0, 9.99,
+                    12, null);
+            Assertions.assertNotNull(loanId);
+            loanIdRef.set(loanId);
+            disburseLoan(loanId, BigDecimal.valueOf(1000), "1 January 2021");
+        });
+        runAt("1 February 2021", () -> {
+            Long loanId = loanIdRef.get();
+            PostLoansLoanIdTransactionsResponse postLoansLoanIdTransactionsResponse = loanTransactionHelper
+                    .makeLoanRepayment("PayoutRefund", "1 February 2021", 1000F, loanId.intValue());
+            Assertions.assertNotNull(postLoansLoanIdTransactionsResponse);
+            Assertions.assertNotNull(postLoansLoanIdTransactionsResponse.getResourceId());
+
+            logTransactions(loanId);
+            verifyTransactions(loanId, transaction(1000.0, "Disbursement", "01 January 2021"),
+                    transaction(1000.0, "Payout Refund", "01 February 2021"), transaction(8.48, "Accrual", "01 February 2021"),
+                    transaction(8.48, "Interest Refund", "01 February 2021"));
+        });
+    }
+
+    @Test
+    public void verifyUC02b() {
+        AtomicReference<Long> loanIdRef = new AtomicReference<>();
+        runAt("1 January 2021", () -> {
+            PostLoanProductsResponse loanProduct = loanProductHelper
+                    .createLoanProduct(create4IProgressive().daysInMonthType(DaysInMonthType.ACTUAL) //
+                            .daysInYearType(DaysInYearType.ACTUAL) //
+                            .supportedInterestRefundTypes(new ArrayList<>()).addSupportedInterestRefundTypesItem("PAYOUT_REFUND") //
+                            .addSupportedInterestRefundTypesItem("MERCHANT_ISSUED_REFUND") //
+                            .recalculationRestFrequencyType(RecalculationRestFrequencyType.DAILY) //
+            );
+            Long loanId = applyAndApproveProgressiveLoan(client.getClientId(), loanProduct.getResourceId(), "1 January 2021", 1000.0, 9.99,
+                    12, null);
+            Assertions.assertNotNull(loanId);
+            loanIdRef.set(loanId);
+            disburseLoan(loanId, BigDecimal.valueOf(1000), "1 January 2021");
+        });
+        runAt("1 February 2021", () -> {
+            Long loanId = loanIdRef.get();
+            PostLoansLoanIdTransactionsResponse postLoansLoanIdTransactionsResponse = loanTransactionHelper.makeLoanRepayment("Repayment",
+                    "1 February 2021", 87.89F, loanId.intValue());
+            Assertions.assertNotNull(postLoansLoanIdTransactionsResponse);
+            Assertions.assertNotNull(postLoansLoanIdTransactionsResponse.getResourceId());
+
+            logTransactions(loanId);
+            verifyTransactions(loanId, transaction(1000.0, "Disbursement", "01 January 2021"),
+                    transaction(87.89, "Repayment", "01 February 2021"));
+        });
+
+        runAt("9 February 2021", () -> {
+            Long loanId = loanIdRef.get();
+            PostLoansLoanIdTransactionsResponse postLoansLoanIdTransactionsResponse = loanTransactionHelper
+                    .makeLoanRepayment("PayoutRefund", "9 February 2021", 1000F, loanId.intValue());
+            Assertions.assertNotNull(postLoansLoanIdTransactionsResponse);
+            Assertions.assertNotNull(postLoansLoanIdTransactionsResponse.getResourceId());
+
+            logTransactions(loanId);
+            verifyTransactions(loanId, transaction(1000.0, "Disbursement", "01 January 2021"),
+                    transaction(1000.0, "Payout Refund", "09 February 2021"), transaction(87.89, "Repayment", "01 February 2021"),
+                    transaction(10.50, "Interest Refund", "09 February 2021"));
+        });
+    }
+
+    @Test
+    public void verifyUC03() {
+        AtomicReference<Long> loanIdRef = new AtomicReference<>();
+        runAt("1 January 2021", () -> {
+            PostLoanProductsResponse loanProduct = loanProductHelper
+                    .createLoanProduct(create4IProgressive().daysInMonthType(DaysInMonthType.ACTUAL) //
+                            .daysInYearType(DaysInYearType.ACTUAL) //
+                            .supportedInterestRefundTypes(new ArrayList<>())//
+                            .disallowExpectedDisbursements(true)//
+                            .multiDisburseLoan(true)//
+                            .maxTrancheCount(2).addSupportedInterestRefundTypesItem("PAYOUT_REFUND") //
+                            .addSupportedInterestRefundTypesItem("MERCHANT_ISSUED_REFUND") //
+                            .recalculationRestFrequencyType(RecalculationRestFrequencyType.DAILY) //
+            );
+            Long loanId = applyAndApproveProgressiveLoan(client.getClientId(), loanProduct.getResourceId(), "1 January 2021", 1000.0, 9.99,
+                    12, null);
+            Assertions.assertNotNull(loanId);
+            loanIdRef.set(loanId);
+            disburseLoan(loanId, BigDecimal.valueOf(750), "1 January 2021");
+            disburseLoan(loanId, BigDecimal.valueOf(250), "1 January 2021");
+        });
+        runAt("22 January 2021", () -> {
+            Long loanId = loanIdRef.get();
+            PostLoansLoanIdTransactionsResponse postLoansLoanIdTransactionsResponse = loanTransactionHelper
+                    .makeLoanRepayment("PayoutRefund", "22 January 2021", 1000F, loanId.intValue());
+            Assertions.assertNotNull(postLoansLoanIdTransactionsResponse);
+            Assertions.assertNotNull(postLoansLoanIdTransactionsResponse.getResourceId());
+
+            logTransactions(loanId);
+            verifyTransactions(loanId, transaction(750.0, "Disbursement", "01 January 2021"),
+                    transaction(250.0, "Disbursement", "01 January 2021"), transaction(1000.0, "Payout Refund", "22 January 2021"),
+                    transaction(5.75, "Accrual", "22 January 2021"), transaction(5.75, "Interest Refund", "22 January 2021"));
+        });
+    }
+
+    @Test
+    public void verifyUC04() {
+        AtomicReference<Long> loanIdRef = new AtomicReference<>();
+        runAt("1 January 2021", () -> {
+            PostLoanProductsResponse loanProduct = loanProductHelper
+                    .createLoanProduct(create4IProgressive().daysInMonthType(DaysInMonthType.ACTUAL) //
+                            .daysInYearType(DaysInYearType.ACTUAL) //
+                            .supportedInterestRefundTypes(new ArrayList<>()).disallowExpectedDisbursements(true).multiDisburseLoan(true)
+                            .maxTrancheCount(2).addSupportedInterestRefundTypesItem("PAYOUT_REFUND") //
+                            .addSupportedInterestRefundTypesItem("MERCHANT_ISSUED_REFUND") //
+                            .recalculationRestFrequencyType(RecalculationRestFrequencyType.DAILY) //
+            );
+            Long loanId = applyAndApproveProgressiveLoan(client.getClientId(), loanProduct.getResourceId(), "1 January 2021", 1000.0, 9.99,
+                    12, null);
+            Assertions.assertNotNull(loanId);
+            loanIdRef.set(loanId);
+            disburseLoan(loanId, BigDecimal.valueOf(250), "1 January 2021");
+        });
+        runAt("4 January 2021", () -> {
+            Long loanId = loanIdRef.get();
+            disburseLoan(loanId, BigDecimal.valueOf(750), "4 January 2021");
+        });
+        runAt("22 January 2021", () -> {
+            Long loanId = loanIdRef.get();
+            PostLoansLoanIdTransactionsResponse postLoansLoanIdTransactionsResponse = loanTransactionHelper
+                    .makeLoanRepayment("PayoutRefund", "22 January 2021", 1000F, loanId.intValue());
+            Assertions.assertNotNull(postLoansLoanIdTransactionsResponse);
+            Assertions.assertNotNull(postLoansLoanIdTransactionsResponse.getResourceId());
+
+            logTransactions(loanId);
+            verifyTransactions(loanId, transaction(750.0, "Disbursement", "04 January 2021"),
+                    transaction(250.0, "Disbursement", "01 January 2021"), transaction(1000.0, "Payout Refund", "22 January 2021"),
+                    transaction(5.14, "Accrual", "22 January 2021"), transaction(5.14, "Interest Refund", "22 January 2021"));
+        });
+    }
+
+    @Test
+    public void verifyUC05() {
+        AtomicReference<Long> loanIdRef = new AtomicReference<>();
+        runAt("1 January 2021", () -> {
+            PostLoanProductsResponse loanProduct = loanProductHelper
+                    .createLoanProduct(create4IProgressive().daysInMonthType(DaysInMonthType.ACTUAL) //
+                            .daysInYearType(DaysInYearType.ACTUAL) //
+                            .supportedInterestRefundTypes(new ArrayList<>()).disallowExpectedDisbursements(true).multiDisburseLoan(true)
+                            .maxTrancheCount(2).addSupportedInterestRefundTypesItem("PAYOUT_REFUND") //
+                            .addSupportedInterestRefundTypesItem("MERCHANT_ISSUED_REFUND") //
+                            .recalculationRestFrequencyType(RecalculationRestFrequencyType.DAILY) //
+            );
+            Long loanId = applyAndApproveProgressiveLoan(client.getClientId(), loanProduct.getResourceId(), "1 January 2021", 1000.0, 9.99,
+                    12, null);
+            Assertions.assertNotNull(loanId);
+            loanIdRef.set(loanId);
+            disburseLoan(loanId, BigDecimal.valueOf(500), "1 January 2021");
+        });
+        runAt("7 January 2021", () -> {
+            Long loanId = loanIdRef.get();
+            disburseLoan(loanId, BigDecimal.valueOf(500), "7 January 2021");
+        });
+        runAt("1 February 2021", () -> {
+            Long loanId = loanIdRef.get();
+            PostLoansLoanIdTransactionsResponse postLoansLoanIdTransactionsResponse = loanTransactionHelper.makeLoanRepayment("Repayment",
+                    "1 February 2021", 87.82F, loanId.intValue());
+            Assertions.assertNotNull(postLoansLoanIdTransactionsResponse);
+            Assertions.assertNotNull(postLoansLoanIdTransactionsResponse.getResourceId());
+
+            logTransactions(loanId);
+            verifyTransactions(loanId, transaction(500.0, "Disbursement", "01 January 2021"),
+                    transaction(500.0, "Disbursement", "07 January 2021"), transaction(87.82, "Repayment", "01 February 2021"));
+        });
+
+        runAt("9 February 2021", () -> {
+            Long loanId = loanIdRef.get();
+            PostLoansLoanIdTransactionsResponse postLoansLoanIdTransactionsResponse = loanTransactionHelper
+                    .makeLoanRepayment("PayoutRefund", "9 February 2021", 1000F, loanId.intValue());
+            Assertions.assertNotNull(postLoansLoanIdTransactionsResponse);
+            Assertions.assertNotNull(postLoansLoanIdTransactionsResponse.getResourceId());
+
+            logTransactions(loanId);
+            verifyTransactions(loanId, transaction(500.0, "Disbursement", "01 January 2021"),
+                    transaction(500.0, "Disbursement", "07 January 2021"), transaction(1000.0, "Payout Refund", "09 February 2021"),
+                    transaction(87.82, "Repayment", "01 February 2021"), transaction(9.67, "Interest Refund", "09 February 2021"));
+        });
+    }
+
+    private void logTransactions(Long loanId) {
+        GetLoansLoanIdResponse loanDetails = loanTransactionHelper.getLoan(requestSpec, responseSpec, loanId.intValue());
+        assert loanDetails.getTransactions() != null;
+        loanDetails.getTransactions()
+                .forEach(tr -> log.info("Transaction {}  {}  {} ", tr.getType().getValue(), tr.getDate(), tr.getAmount()));
+    }
+
+}
@@ -44,7 +44,6 @@ import org.apache.fineract.integrationtests.common.Utils;
 import org.apache.fineract.integrationtests.common.accounting.AccountHelper;
 import org.apache.fineract.integrationtests.common.loans.LoanProductTestBuilder;
 import org.apache.fineract.integrationtests.common.loans.LoanTransactionHelper;
-import org.apache.fineract.portfolio.common.domain.DaysInMonthType;
 import org.junit.jupiter.api.BeforeAll;
 import org.junit.jupiter.api.Test;
 import org.slf4j.Logger;
@@ -89,8 +88,8 @@ public class LoanRefundTransactionTest extends BaseLoanIntegrationTest {
            Long clientId = clientHelper.createClient(ClientHelper.defaultClientCreationRequest()).getClientId();
            PostLoanProductsRequest product = createOnePeriod30DaysLongNoInterestPeriodicAccrualProductWithAdvancedPaymentAllocation()
                    .interestRatePerPeriod(108.0).interestCalculationPeriodType(RepaymentFrequencyType.DAYS)
-                    .interestRateFrequencyType(YEARS).daysInMonthType(DaysInMonthType.ACTUAL.getValue())
-                    .daysInYearType(DaysInYearType.DAYS_360).numberOfRepayments(4)//
+                    .interestRateFrequencyType(YEARS).daysInMonthType(DaysInMonthType.ACTUAL).daysInYearType(DaysInYearType.DAYS_360)
+                    .numberOfRepayments(4)//
                    .maxInterestRatePerPeriod((double) 110)//
                    .repaymentEvery(1)//
                    .repaymentFrequencyType(1L)//
@@ -161,8 +160,8 @@ public class LoanRefundTransactionTest extends BaseLoanIntegrationTest {
            Long clientId = clientHelper.createClient(ClientHelper.defaultClientCreationRequest()).getClientId();
            PostLoanProductsRequest product = createOnePeriod30DaysLongNoInterestPeriodicAccrualProductWithAdvancedPaymentAllocation()
                    .interestRatePerPeriod(108.0).interestCalculationPeriodType(RepaymentFrequencyType.DAYS)
-                    .interestRateFrequencyType(YEARS).daysInMonthType(DaysInMonthType.ACTUAL.getValue())
-                    .daysInYearType(DaysInYearType.DAYS_360).numberOfRepayments(4)//
+                    .interestRateFrequencyType(YEARS).daysInMonthType(DaysInMonthType.ACTUAL).daysInYearType(DaysInYearType.DAYS_360)
+                    .numberOfRepayments(4)//
                    .maxInterestRatePerPeriod((double) 110)//
                    .repaymentEvery(1)//
                    .repaymentFrequencyType(1L)//
@@ -560,6 +560,16 @@ public class ExternalEventConfigurationHelper {
        loanTransactionAccrualActivityPreBusinessEvent.put("enabled", false);
        defaults.add(loanTransactionAccrualActivityPreBusinessEvent);

+        Map<String, Object> loanTransactionInterestRefundPostBusinessEvent = new HashMap<>();
+        loanTransactionInterestRefundPostBusinessEvent.put("type", "LoanTransactionInterestRefundPostBusinessEvent");
+        loanTransactionInterestRefundPostBusinessEvent.put("enabled", false);
+        defaults.add(loanTransactionInterestRefundPostBusinessEvent);
+
+        Map<String, Object> loanTransactionInterestRefundPreBusinessEvent = new HashMap<>();
+        loanTransactionInterestRefundPreBusinessEvent.put("type", "LoanTransactionInterestRefundPreBusinessEvent");
+        loanTransactionInterestRefundPreBusinessEvent.put("enabled", false);
+        defaults.add(loanTransactionInterestRefundPreBusinessEvent);
+
        return defaults;

    }