FINERACT-2232: add income capitalization principal handling and repayment schedule calculations on loans

custom/acme/note/service/src/main/java/com/acme/fineract/portfolio/note/service/AcmeNoteWritePlatformService.java

@@ -43,8 +43,8 @@ public class AcmeNoteWritePlatformService implements NoteWritePlatformService, I
     }
 
     @Override
-    public void createLoanNote(Long loanId, String note) {
+    public void createLoanTransactionNote(Long loanTransactionId, String note) {
-        throw new UnsupportedOperationException("createLoanNote() is not yet implemented.");
+        throw new UnsupportedOperationException("createLoanTransactionNote() is not yet implemented.");
     }
 
     @Override

fineract-avro-schemas/src/main/avro/loan/v1/LoanSummaryDataV1.avsc

@@ -458,6 +458,30 @@
                 "null",
                 "bigdecimal"
             ]
+        },
+        {
+            "default": null,
+            "name": "totalPrincipal",
+            "type": [
+                "null",
+                "bigdecimal"
+            ]
+        },
+        {
+            "default": null,
+            "name": "totalCapitalizedIncome",
+            "type": [
+                "null",
+                "bigdecimal"
+            ]
+        },
+        {
+            "default": null,
+            "name": "totalCapitalizedIncomeAdjustment",
+            "type": [
+                "null",
+                "bigdecimal"
+            ]
         }
     ]
 }

fineract-core/src/main/java/org/apache/fineract/infrastructure/core/service/DateUtils.java

@@ -310,6 +310,12 @@ public final class DateUtils {
         return isBeforeBusinessDate(localDate);
     }
 
+    public static boolean isDateInRangeFromInclusiveToExclusive(final LocalDate fromInclusive, final LocalDate upToNotInclusive,
+            final LocalDate target) {
+        return (DateUtils.isEqual(target, fromInclusive) || DateUtils.isAfter(target, fromInclusive))
+                && DateUtils.isBefore(target, upToNotInclusive);
+    }
+
     public static int compare(LocalDate first, LocalDate second) {
         return compare(first, second, true);
     }

fineract-core/src/main/java/org/apache/fineract/portfolio/note/service/NoteWritePlatformService.java

@@ -26,7 +26,7 @@ public interface NoteWritePlatformService {
 
     CommandProcessingResult createNote(JsonCommand command);
 
-    void createLoanNote(Long loanId, String note);
+    void createLoanTransactionNote(Long loanTransactionId, String note);
 
     CommandProcessingResult updateNote(JsonCommand command);
 

fineract-e2e-tests-runner/src/test/resources/features/LoanCapitalizedIncome.feature

@@ -188,12 +188,12 @@ Feature: Capitalized Income
       | Type      | Account code | Account name                 | Debit  | Credit |
       | ASSET     | 112601       | Loans Receivable             | 100.0  |        |
       | LIABILITY | 145024       | Deferred Capitalized Income  |        | 100.0  |
-    When Customer makes "REPAYMENT" transaction with "AUTOPAY" payment type on "2 January 2024" with 900.17 EUR transaction amount and system-generated Idempotency key
+    When Customer makes "REPAYMENT" transaction with "AUTOPAY" payment type on "2 January 2024" with 1000.17 EUR transaction amount and system-generated Idempotency key
     Then Loan Transactions tab has the following data:
       | Transaction date | Transaction Type                | Amount | Principal | Interest | Fees | Penalties | Loan Balance | Reverted |
       | 01 January 2024  | Disbursement                    | 900.0  | 0.0       | 0.0      | 0.0  | 0.0       | 900.0        | false    |
       | 02 January 2024  | Capitalized Income              | 100.0  | 100.0     | 0.0      | 0.0  | 0.0       | 1000.0       | false    |
-      | 02 January 2024  | Repayment                       | 900.17 | 900.0     | 0.17     | 0.0  | 0.0       | 100.0        | false    |
+      | 02 January 2024  | Repayment                       | 1000.17| 1000.0    | 0.17     | 0.0  | 0.0       | 0.0          | false    |
       | 02 January 2024  | Accrual                         | 0.17   | 0.0       | 0.17     | 0.0  | 0.0       | 0.0          | false    |
       | 02 January 2024  | Capitalized Income Amortization | 100.0  | 0.0       | 100.0    | 0.0  | 0.0       | 0.0          | false    |
     Then Loan Transactions tab has a "CAPITALIZED_INCOME_AMORTIZATION" transaction with date "02 January 2024" which has the following Journal entries:
@@ -222,12 +222,12 @@ Feature: Capitalized Income
       | Type      | Account code | Account name                 | Debit  | Credit |
       | ASSET     | 112601       | Loans Receivable             | 100.0  |        |
       | LIABILITY | 145024       | Deferred Capitalized Income  |        | 100.0  |
-    When Customer makes "REPAYMENT" transaction with "AUTOPAY" payment type on "2 January 2024" with 1000 EUR transaction amount and system-generated Idempotency key
+    When Customer makes "REPAYMENT" transaction with "AUTOPAY" payment type on "2 January 2024" with 1100 EUR transaction amount and system-generated Idempotency key
     Then Loan Transactions tab has the following data:
       | Transaction date | Transaction Type                | Amount | Principal | Interest | Fees | Penalties | Loan Balance | Reverted |
       | 01 January 2024  | Disbursement                    | 900.0  | 0.0       | 0.0      | 0.0  | 0.0       | 900.0        | false    |
       | 02 January 2024  | Capitalized Income              | 100.0  | 100.0     | 0.0      | 0.0  | 0.0       | 1000.0       | false    |
-      | 02 January 2024  | Repayment                       | 1000.0 | 900.0     | 0.17     | 0.0  | 0.0       | 100.0        | false    |
+      | 02 January 2024  | Repayment                       | 1100.0 | 1000.0    | 0.17     | 0.0  | 0.0       | 0.0          | false    |
       | 02 January 2024  | Accrual                         | 0.17   | 0.0       | 0.17     | 0.0  | 0.0       | 0.0          | false    |
       | 02 January 2024  | Capitalized Income Amortization | 100.0  | 0.0       | 100.0    | 0.0  | 0.0       | 0.0          | false    |
     Then Loan Transactions tab has a "CAPITALIZED_INCOME_AMORTIZATION" transaction with date "02 January 2024" which has the following Journal entries:
@@ -262,7 +262,7 @@ Feature: Capitalized Income
       | Transaction date | Transaction Type                | Amount | Principal | Interest | Fees | Penalties | Loan Balance | Reverted |
       | 01 January 2024  | Disbursement                    | 900.0  | 0.0       | 0.0      | 0.0  | 0.0       | 900.0        | false    |
       | 02 January 2024  | Capitalized Income              | 100.0  | 100.0     | 0.0      | 0.0  | 0.0       | 1000.0       | false    |
-      | 02 January 2024  | Close (as written-off)          | 905.25 | 900.0     | 5.25     | 0.0  | 0.0       | 100.0        | false    |
+      | 02 January 2024  | Close (as written-off)          | 1005.81| 1000.0    | 5.81     | 0.0  | 0.0       | 0.0          | false    |
       | 02 January 2024  | Capitalized Income Amortization | 100.0  | 0.0       | 100.0    | 0.0  | 0.0       | 0.0          | false    |
     Then Loan Transactions tab has a "CAPITALIZED_INCOME_AMORTIZATION" transaction with date "02 January 2024" which has the following Journal entries:
       | Type      | Account code | Account name                 | Debit  | Credit |
@@ -555,16 +555,16 @@ Feature: Capitalized Income
     And Admin does charge-off the loan with reason "DELINQUENT" on "03 February 2024"
     Then Loan Transactions tab has a "CHARGE_OFF" transaction with date "03 February 2024" which has the following Journal entries:
       | Type    | Account code | Account name               | Debit | Credit |
-      | ASSET   | 112601       | Loans Receivable           |       | 900.0  |
+      | ASSET   | 112601       | Loans Receivable           |       | 1000.0 |
-      | ASSET   | 112603       | Interest/Fee Receivable    |       | 4.0    |
+      | ASSET   | 112603       | Interest/Fee Receivable    |       | 4.58   |
-      | EXPENSE | 744007       | Credit Loss/Bad Debt       | 900.0 |        |
+      | EXPENSE | 744007       | Credit Loss/Bad Debt       | 1000.0|        |
-      | INCOME  | 404001       | Interest Income Charge Off | 4.0   |        |
+      | INCOME  | 404001       | Interest Income Charge Off | 4.58  |        |
     Then Loan Transactions tab has the following data:
       | Transaction date | Transaction Type                | Amount | Principal | Interest | Fees | Penalties | Loan Balance | Reverted |
       | 01 January 2024  | Disbursement                    | 900.0  | 0.0       | 0.0      | 0.0  | 0.0       | 900.0        | false    |
       | 02 January 2024  | Capitalized Income              | 100.0  | 100.0     | 0.0      | 0.0  | 0.0       | 1000.0       | false    |
-      | 03 February 2024 | Accrual                         | 4.0    | 0.0       | 4.0      | 0.0  | 0.0       | 0.0          | false    |
+      | 03 February 2024 | Accrual                         | 4.58   | 0.0       | 4.58     | 0.0  | 0.0       | 0.0          | false    |
-      | 03 February 2024 | Charge-off                      | 904.0  | 900.0     | 4.0      | 0.0  | 0.0       | 0.0          | false    |
+      | 03 February 2024 | Charge-off                      | 1004.58| 1000.0    | 4.58     | 0.0  | 0.0       | 0.0          | false    |
       | 03 February 2024 | Capitalized Income Amortization | 100.0  | 0.0       | 100.0    | 0.0  | 0.0       | 0.0          | false    |
     Then Loan Transactions tab has a "CAPITALIZED_INCOME_AMORTIZATION" transaction with date "03 February 2024" which has the following Journal entries:
       | Type      | Account code | Account name                 | Debit  | Credit |
@@ -597,16 +597,16 @@ Feature: Capitalized Income
     And Admin does charge-off the loan on "03 February 2024"
     Then Loan Transactions tab has a "CHARGE_OFF" transaction with date "03 February 2024" which has the following Journal entries:
       | Type    | Account code | Account name               | Debit | Credit |
-      | ASSET   | 112601       | Loans Receivable           |       | 900.0  |
+      | ASSET   | 112601       | Loans Receivable           |       | 1000.0 |
-      | ASSET   | 112603       | Interest/Fee Receivable    |       | 4.0    |
+      | ASSET   | 112603       | Interest/Fee Receivable    |       | 4.58   |
-      | EXPENSE | 744037       | Credit Loss/Bad Debt-Fraud | 900.0 |        |
+      | EXPENSE | 744037       | Credit Loss/Bad Debt-Fraud | 1000.0|        |
-      | INCOME  | 404001       | Interest Income Charge Off | 4.0   |        |
+      | INCOME  | 404001       | Interest Income Charge Off | 4.58  |        |
     Then Loan Transactions tab has the following data:
       | Transaction date | Transaction Type                | Amount | Principal | Interest | Fees | Penalties | Loan Balance | Reverted |
       | 01 January 2024  | Disbursement                    | 900.0  | 0.0       | 0.0      | 0.0  | 0.0       | 900.0        | false    |
       | 02 January 2024  | Capitalized Income              | 100.0  | 100.0     | 0.0      | 0.0  | 0.0       | 1000.0       | false    |
-      | 03 February 2024 | Accrual                         | 4.0    | 0.0       | 4.0      | 0.0  | 0.0       | 0.0          | false    |
+      | 03 February 2024 | Accrual                         | 4.58   | 0.0       | 4.58     | 0.0  | 0.0       | 0.0          | false    |
-      | 03 February 2024 | Charge-off                      | 904.0  | 900.0     | 4.0      | 0.0  | 0.0       | 0.0          | false    |
+      | 03 February 2024 | Charge-off                      | 1004.58| 1000.0    | 4.58     | 0.0  | 0.0       | 0.0          | false    |
       | 03 February 2024 | Capitalized Income Amortization | 100.0  | 0.0       | 100.0    | 0.0  | 0.0       | 0.0          | false    |
     Then Loan Transactions tab has a "CAPITALIZED_INCOME_AMORTIZATION" transaction with date "03 February 2024" which has the following Journal entries:
       | Type      | Account code | Account name                 | Debit  | Credit |
@@ -639,16 +639,16 @@ Feature: Capitalized Income
     And Admin does charge-off the loan with reason "DELINQUENT" on "03 February 2024"
     Then Loan Transactions tab has a "CHARGE_OFF" transaction with date "03 February 2024" which has the following Journal entries:
       | Type    | Account code | Account name               | Debit | Credit |
-      | ASSET   | 112601       | Loans Receivable           |       | 900.0  |
+      | ASSET   | 112601       | Loans Receivable           |       | 1000.0 |
-      | ASSET   | 112603       | Interest/Fee Receivable    |       | 4.0    |
+      | ASSET   | 112603       | Interest/Fee Receivable    |       | 4.58   |
-      | EXPENSE | 744007       | Credit Loss/Bad Debt       | 900.0 |        |
+      | EXPENSE | 744007       | Credit Loss/Bad Debt       | 1000.0|        |
-      | INCOME  | 404001       | Interest Income Charge Off | 4.0   |        |
+      | INCOME  | 404001       | Interest Income Charge Off | 4.58  |        |
     Then Loan Transactions tab has the following data:
       | Transaction date | Transaction Type                | Amount | Principal | Interest | Fees | Penalties | Loan Balance | Reverted |
       | 01 January 2024  | Disbursement                    | 900.0  | 0.0       | 0.0      | 0.0  | 0.0       | 900.0        | false    |
       | 02 January 2024  | Capitalized Income              | 100.0  | 100.0     | 0.0      | 0.0  | 0.0       | 1000.0       | false    |
-      | 03 February 2024 | Accrual                         | 4.0    | 0.0       | 4.0      | 0.0  | 0.0       | 0.0          | false    |
+      | 03 February 2024 | Accrual                         | 4.58   | 0.0       | 4.58     | 0.0  | 0.0       | 0.0          | false    |
-      | 03 February 2024 | Charge-off                      | 904.0  | 900.0     | 4.0      | 0.0  | 0.0       | 0.0          | false    |
+      | 03 February 2024 | Charge-off                      | 1004.58| 1000.0    | 4.58     | 0.0  | 0.0       | 0.0          | false    |
       | 03 February 2024 | Capitalized Income Amortization | 100.0  | 0.0       | 100.0    | 0.0  | 0.0       | 0.0          | false    |
     Then Loan Transactions tab has a "CAPITALIZED_INCOME_AMORTIZATION" transaction with date "03 February 2024" which has the following Journal entries:
       | Type      | Account code | Account name                 | Debit  | Credit |
@@ -681,16 +681,16 @@ Feature: Capitalized Income
     And Admin does charge-off the loan with reason "DELINQUENT" on "03 February 2024"
     Then Loan Transactions tab has a "CHARGE_OFF" transaction with date "03 February 2024" which has the following Journal entries:
       | Type    | Account code | Account name               | Debit | Credit |
-      | ASSET   | 112601       | Loans Receivable           |       | 900.0  |
+      | ASSET   | 112601       | Loans Receivable           |       | 1000.0 |
-      | ASSET   | 112603       | Interest/Fee Receivable    |       | 4.0    |
+      | ASSET   | 112603       | Interest/Fee Receivable    |       | 4.58   |
-      | EXPENSE | 744007       | Credit Loss/Bad Debt       | 900.0 |        |
+      | EXPENSE | 744007       | Credit Loss/Bad Debt       | 1000.0|        |
-      | INCOME  | 404001       | Interest Income Charge Off | 4.0   |        |
+      | INCOME  | 404001       | Interest Income Charge Off | 4.58  |        |
     Then Loan Transactions tab has the following data:
       | Transaction date | Transaction Type                | Amount | Principal | Interest | Fees | Penalties | Loan Balance | Reverted |
       | 01 January 2024  | Disbursement                    | 900.0  | 0.0       | 0.0      | 0.0  | 0.0       | 900.0        | false    |
       | 02 January 2024  | Capitalized Income              | 100.0  | 100.0     | 0.0      | 0.0  | 0.0       | 1000.0       | false    |
-      | 03 February 2024 | Accrual                         | 4.0    | 0.0       | 4.0      | 0.0  | 0.0       | 0.0          | false    |
+      | 03 February 2024 | Accrual                         | 4.58   | 0.0       | 4.58     | 0.0  | 0.0       | 0.0          | false    |
-      | 03 February 2024 | Charge-off                      | 904.0  | 900.0     | 4.0      | 0.0  | 0.0       | 0.0          | false    |
+      | 03 February 2024 | Charge-off                      | 1004.58| 1000.0    | 4.58     | 0.0  | 0.0       | 0.0          | false    |
       | 03 February 2024 | Capitalized Income Amortization | 100.0  | 0.0       | 100.0    | 0.0  | 0.0       | 0.0          | false    |
     Then Loan Transactions tab has a "CAPITALIZED_INCOME_AMORTIZATION" transaction with date "03 February 2024" which has the following Journal entries:
       | Type      | Account code | Account name                 | Debit  | Credit |
@@ -700,20 +700,20 @@ Feature: Capitalized Income
     Then Admin does a charge-off undo the loan
     Then Loan Transactions tab has a "CHARGE_OFF" transaction with date "03 February 2024" which has the following Journal entries:
       | Type    | Account code | Account name               | Debit | Credit |
-      | ASSET   | 112601       | Loans Receivable           |       | 900.0  |
+      | ASSET   | 112601       | Loans Receivable           |       | 1000.0 |
-      | ASSET   | 112603       | Interest/Fee Receivable    |       | 4.0    |
+      | ASSET   | 112603       | Interest/Fee Receivable    |       | 4.58   |
-      | EXPENSE | 744007       | Credit Loss/Bad Debt       | 900.0 |        |
+      | EXPENSE | 744007       | Credit Loss/Bad Debt       | 1000.0|        |
-      | INCOME  | 404001       | Interest Income Charge Off | 4.0   |        |
+      | INCOME  | 404001       | Interest Income Charge Off | 4.58  |        |
-      | ASSET   | 112601       | Loans Receivable           | 900.0 |        |
+      | ASSET   | 112601       | Loans Receivable           | 1000.0|        |
-      | ASSET   | 112603       | Interest/Fee Receivable    | 4.0   |        |
+      | ASSET   | 112603       | Interest/Fee Receivable    | 4.58  |        |
-      | EXPENSE | 744007       | Credit Loss/Bad Debt       |       | 900.0  |
+      | EXPENSE | 744007       | Credit Loss/Bad Debt       |       | 1000.0 |
-      | INCOME  | 404001       | Interest Income Charge Off |       | 4.0    |
+      | INCOME  | 404001       | Interest Income Charge Off |       | 4.58   |
     Then Loan Transactions tab has the following data:
       | Transaction date | Transaction Type                | Amount | Principal | Interest | Fees | Penalties | Loan Balance | Reverted |
       | 01 January 2024  | Disbursement                    | 900.0  | 0.0       | 0.0      | 0.0  | 0.0       | 900.0        | false    |
       | 02 January 2024  | Capitalized Income              | 100.0  | 100.0     | 0.0      | 0.0  | 0.0       | 1000.0       | false    |
-      | 03 February 2024 | Accrual                         | 4.0    | 0.0       | 4.0      | 0.0  | 0.0       | 0.0          | false    |
+      | 03 February 2024 | Accrual                         | 4.58   | 0.0       | 4.58     | 0.0  | 0.0       | 0.0          | false    |
-      | 03 February 2024 | Charge-off                      | 904.0  | 900.0     | 4.0      | 0.0  | 0.0       | 0.0          | true     |
+      | 03 February 2024 | Charge-off                      | 1004.58| 1000.0    | 4.58     | 0.0  | 0.0       | 0.0          | true     |
     Then Reversed loan capitalized income amortization transaction has the following Journal entries:
       | Type      | Account code | Account name                 | Debit  | Credit |
       | EXPENSE   | 744007       | Credit Loss/Bad Debt         |        | 100.0  |

fineract-loan/src/main/java/org/apache/fineract/portfolio/loanaccount/data/DisbursementData.java

@@ -30,7 +30,7 @@ import org.apache.fineract.portfolio.loanaccount.loanschedule.domain.LoanSchedul
  */
 @RequiredArgsConstructor
 @Getter
-public final class DisbursementData implements Comparable<DisbursementData> {
+public final class DisbursementData implements LoanPrincipalRelatedDataHolder, Comparable<DisbursementData> {
 
     private final Long id;
     private final LocalDate expectedDisbursementDate;
@@ -102,8 +102,7 @@ public final class DisbursementData implements Comparable<DisbursementData> {
 
     private boolean occursOnDayFromAndIncludingAndUpTo(final LocalDate fromInclusive, final LocalDate upToNotInclusive,
             final LocalDate target) {
-        return (DateUtils.isEqual(target, fromInclusive) || DateUtils.isAfter(target, fromInclusive))
+        return DateUtils.isDateInRangeFromInclusiveToExclusive(fromInclusive, upToNotInclusive, target);
-                && DateUtils.isBefore(target, upToNotInclusive);
     }
 
     public BigDecimal getWaivedChargeAmount() {

fineract-loan/src/main/java/org/apache/fineract/portfolio/loanaccount/data/LoanSummaryData.java

@@ -34,6 +34,9 @@ import org.apache.fineract.organisation.monetary.data.CurrencyData;
 public class LoanSummaryData {
 
     private final CurrencyData currency;
+    private final BigDecimal totalPrincipal;
+    private final BigDecimal totalCapitalizedIncome;
+    private final BigDecimal totalCapitalizedIncomeAdjustment;
     private final BigDecimal principalDisbursed;
     private final BigDecimal principalAdjustments;
     private final BigDecimal principalPaid;

fineract-loan/src/main/java/org/apache/fineract/portfolio/loanaccount/domain/LoanSummary.java

@@ -38,6 +38,15 @@ import org.apache.fineract.organisation.monetary.domain.Money;
 public class LoanSummary {
 
     // derived totals fields
+    @Column(name = "total_principal_derived", scale = 6, precision = 19)
+    private BigDecimal totalPrincipal;
+
+    @Column(name = "capitalized_income_derived", scale = 6, precision = 19)
+    private BigDecimal totalCapitalizedIncome;
+
+    @Column(name = "capitalized_income_adjustment_derived", scale = 6, precision = 19)
+    private BigDecimal totalCapitalizedIncomeAdjustment;
+
     @Column(name = "principal_disbursed_derived", scale = 6, precision = 19)
     private BigDecimal totalPrincipalDisbursed;
 
@@ -166,6 +175,9 @@ public class LoanSummary {
         this.totalPenaltyChargesWaived = BigDecimal.ZERO;
         this.totalPenaltyChargesWrittenOff = BigDecimal.ZERO;
         this.totalPrincipalAdjustments = BigDecimal.ZERO;
+        this.totalPrincipal = BigDecimal.ZERO;
+        this.totalCapitalizedIncome = BigDecimal.ZERO;
+        this.totalCapitalizedIncomeAdjustment = BigDecimal.ZERO;
         this.totalPrincipalDisbursed = BigDecimal.ZERO;
         this.totalPrincipalOutstanding = BigDecimal.ZERO;
         this.totalPrincipalRepaid = BigDecimal.ZERO;
@@ -176,17 +188,20 @@ public class LoanSummary {
     }
 
     public void updateSummary(final MonetaryCurrency currency, final Money principal,
-            final List<LoanRepaymentScheduleInstallment> repaymentScheduleInstallments, Set<LoanCharge> charges) {
+            final List<LoanRepaymentScheduleInstallment> repaymentScheduleInstallments, Set<LoanCharge> charges, Money capitalizedIncome,
-
+            Money capitalizedIncomeAdjustment) {
         this.totalPrincipalDisbursed = principal.getAmount();
+        this.totalCapitalizedIncome = capitalizedIncome.getAmount();
+        this.totalCapitalizedIncomeAdjustment = capitalizedIncomeAdjustment.getAmount();
+        this.totalPrincipal = principal.plus(capitalizedIncome).getAmount();
         this.totalPrincipalAdjustments = calculateTotalPrincipalAdjusted(repaymentScheduleInstallments, currency).getAmount();
         this.totalFeeAdjustments = calculateTotalFeeAdjusted(repaymentScheduleInstallments, currency).getAmount();
         this.totalPenaltyAdjustments = calculateTotalPenaltyAdjusted(repaymentScheduleInstallments, currency).getAmount();
         this.totalPrincipalRepaid = calculateTotalPrincipalRepaid(repaymentScheduleInstallments, currency).getAmount();
         this.totalPrincipalWrittenOff = calculateTotalPrincipalWrittenOff(repaymentScheduleInstallments, currency).getAmount();
 
-        this.totalPrincipalOutstanding = principal.plus(this.totalPrincipalAdjustments).minus(this.totalPrincipalRepaid)
+        this.totalPrincipalOutstanding = principal.plus(capitalizedIncome).plus(this.totalPrincipalAdjustments)
-                .minus(this.totalPrincipalWrittenOff).getAmount();
+                .minus(this.totalPrincipalRepaid).minus(this.totalPrincipalWrittenOff).getAmount();
 
         final Money totalInterestCharged = calculateTotalInterestCharged(repaymentScheduleInstallments, currency);
         this.totalInterestCharged = totalInterestCharged.getAmount();
@@ -225,7 +240,7 @@ public class LoanSummary {
         this.totalPenaltyChargesOutstanding = totalPenaltyChargesCharged.minus(this.totalPenaltyChargesRepaid)
                 .minus(this.totalPenaltyChargesWaived).minus(this.totalPenaltyChargesWrittenOff).getAmount();
 
-        final Money totalExpectedRepayment = Money.of(currency, this.totalPrincipalDisbursed).plus(this.totalInterestCharged)
+        final Money totalExpectedRepayment = Money.of(currency, this.totalPrincipal).plus(this.totalInterestCharged)
                 .plus(this.totalFeeChargesCharged).plus(this.totalPenaltyChargesCharged);
         this.totalExpectedRepayment = totalExpectedRepayment.getAmount();
 

fineract-loan/src/main/java/org/apache/fineract/portfolio/loanaccount/domain/LoanTransactionRepaymentPeriodData.java

@@ -0,0 +1,53 @@
+/**
+ * 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.portfolio.loanaccount.domain;
+
+import java.io.Serializable;
+import java.math.BigDecimal;
+import java.time.LocalDate;
+import lombok.EqualsAndHashCode;
+import lombok.Getter;
+import org.apache.fineract.portfolio.loanaccount.data.LoanPrincipalRelatedDataHolder;
+
+/**
+ * Immutable data object representing a subset of loan transaction data.
+ */
+@Getter
+@EqualsAndHashCode
+public class LoanTransactionRepaymentPeriodData implements LoanPrincipalRelatedDataHolder, Serializable {
+
+    private final Long transactionId;
+    private final Long loanId;
+    private final LocalDate date;
+    private final boolean reversed;
+    private final BigDecimal amount;
+    private final BigDecimal unrecognizedAmount;
+    private final BigDecimal feeChargesPortion;
+
+    public LoanTransactionRepaymentPeriodData(Long transactionId, Long loanId, LocalDate date, boolean reversed, BigDecimal amount,
+            BigDecimal unrecognizedAmount, BigDecimal feeChargesPortion) {
+        this.transactionId = transactionId;
+        this.loanId = loanId;
+        this.date = date;
+        this.reversed = reversed;
+        this.amount = amount;
+        this.unrecognizedAmount = unrecognizedAmount;
+        this.feeChargesPortion = feeChargesPortion;
+    }
+}

fineract-loan/src/main/java/org/apache/fineract/portfolio/loanaccount/serialization/LoanRefundValidator.java

@@ -104,7 +104,10 @@ public final class LoanRefundValidator {
         if (loan.getLoanProduct().isMultiDisburseLoan() && adjustedTransaction == null) {
             final BigDecimal totalDisbursed = loan.getDisbursedAmount();
             final BigDecimal totalPrincipalAdjusted = loan.getSummary().getTotalPrincipalAdjustments();
-            final BigDecimal totalPrincipalCredited = totalDisbursed.add(totalPrincipalAdjusted);
+            final BigDecimal totalCapitalizedIncome = loan.getLoanTransactions(LoanTransaction::isCapitalizedIncome).stream()
+                    .filter(LoanTransaction::isNotReversed).map(LoanTransaction::getPrincipalPortion)
+                    .reduce(BigDecimal.ZERO, BigDecimal::add);
+            final BigDecimal totalPrincipalCredited = totalDisbursed.add(totalPrincipalAdjusted).add(totalCapitalizedIncome);
             if (totalPrincipalCredited.compareTo(loan.getSummary().getTotalPrincipalRepaid()) < 0) {
                 final String errorMessage = "The transaction amount cannot exceed threshold.";
                 throw new InvalidLoanStateTransitionException("transaction", "amount.exceeds.threshold", errorMessage);

fineract-loan/src/main/java/org/apache/fineract/portfolio/loanaccount/service/CapitalizedIncomeBalanceService.java

@@ -0,0 +1,29 @@
+/**
+ * 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.portfolio.loanaccount.service;
+
+import org.apache.fineract.organisation.monetary.domain.Money;
+import org.apache.fineract.portfolio.loanaccount.domain.Loan;
+
+public interface CapitalizedIncomeBalanceService {
+
+    Money calculateCapitalizedIncome(Loan loan);
+
+    Money calculateCapitalizedIncomeAdjustment(Loan loan);
+}

fineract-loan/src/main/java/org/apache/fineract/portfolio/loanaccount/service/LoanBalanceService.java

@@ -21,6 +21,7 @@ package org.apache.fineract.portfolio.loanaccount.service;
 import java.math.BigDecimal;
 import java.time.LocalDate;
 import java.util.List;
+import lombok.RequiredArgsConstructor;
 import org.apache.fineract.infrastructure.core.service.DateUtils;
 import org.apache.fineract.organisation.monetary.domain.MonetaryCurrency;
 import org.apache.fineract.organisation.monetary.domain.Money;
@@ -35,8 +36,11 @@ import org.apache.fineract.portfolio.loanproduct.domain.CreditAllocationTransact
 import org.springframework.stereotype.Service;
 
 @Service
+@RequiredArgsConstructor
 public class LoanBalanceService {
 
+    private final CapitalizedIncomeBalanceService capitalizedIncomeBalanceService;
+
     public Money calculateTotalOverpayment(final Loan loan) {
         Money totalPaidInRepayments = loan.getTotalPaidInRepayments();
 
@@ -97,7 +101,10 @@ public class LoanBalanceService {
             loan.setTotalRecovered(recoveredAmount.getAmountDefaultedToNullIfZero());
 
             final Money principal = loan.getLoanRepaymentScheduleDetail().getPrincipal();
-            loan.getSummary().updateSummary(loan.getCurrency(), principal, loan.getRepaymentScheduleInstallments(), loan.getLoanCharges());
+            final Money capitalizedIncome = capitalizedIncomeBalanceService.calculateCapitalizedIncome(loan);
+            final Money capitalizedIncomeAdjustment = capitalizedIncomeBalanceService.calculateCapitalizedIncomeAdjustment(loan);
+            loan.getSummary().updateSummary(loan.getCurrency(), principal, loan.getRepaymentScheduleInstallments(), loan.getLoanCharges(),
+                    capitalizedIncome, capitalizedIncomeAdjustment);
             loan.updateLoanOutstandingBalances();
         }
     }

fineract-loan/src/main/java/org/apache/fineract/portfolio/loanaccount/service/LoanDownPaymentHandlerServiceImpl.java

@@ -173,7 +173,10 @@ public class LoanDownPaymentHandlerServiceImpl implements LoanDownPaymentHandler
         if (loan.getLoanProduct().isMultiDisburseLoan()) {
             final BigDecimal totalDisbursed = loan.getDisbursedAmount();
             final BigDecimal totalPrincipalAdjusted = loan.getSummary().getTotalPrincipalAdjustments();
-            final BigDecimal totalPrincipalCredited = totalDisbursed.add(totalPrincipalAdjusted);
+            final BigDecimal totalCapitalizedIncome = loan.getLoanTransactions(LoanTransaction::isCapitalizedIncome).stream()
+                    .filter(LoanTransaction::isNotReversed).map(LoanTransaction::getPrincipalPortion)
+                    .reduce(BigDecimal.ZERO, BigDecimal::add);
+            final BigDecimal totalPrincipalCredited = totalDisbursed.add(totalPrincipalAdjusted).add(totalCapitalizedIncome);
             if (totalPrincipalCredited.compareTo(loan.getSummary().getTotalPrincipalRepaid()) < 0
                     && loan.repaymentScheduleDetail().getPrincipal().minus(totalDisbursed).isGreaterThanZero()) {
                 final String errorMessage = "The transaction amount cannot exceed threshold.";

fineract-loan/src/main/java/org/apache/fineract/portfolio/loanaccount/service/LoanReadPlatformService.java

@@ -37,6 +37,7 @@ import org.apache.fineract.portfolio.loanaccount.data.LoanTransactionData;
 import org.apache.fineract.portfolio.loanaccount.data.PaidInAdvanceData;
 import org.apache.fineract.portfolio.loanaccount.data.RepaymentScheduleRelatedLoanData;
 import org.apache.fineract.portfolio.loanaccount.domain.Loan;
+import org.apache.fineract.portfolio.loanaccount.domain.LoanTransactionRepaymentPeriodData;
 import org.apache.fineract.portfolio.loanaccount.domain.LoanTransactionType;
 import org.apache.fineract.portfolio.loanaccount.loanschedule.data.LoanScheduleData;
 import org.apache.fineract.portfolio.loanaccount.loanschedule.data.OverdueLoanScheduleData;
@@ -50,7 +51,8 @@ public interface LoanReadPlatformService {
     LoanAccountData fetchRepaymentScheduleData(LoanAccountData accountData);
 
     LoanScheduleData retrieveRepaymentSchedule(Long loanId, RepaymentScheduleRelatedLoanData repaymentScheduleRelatedData,
-            Collection<DisbursementData> disbursementData, boolean isInterestRecalculationEnabled, LoanScheduleType loanScheduleType);
+            Collection<DisbursementData> disbursementData, Collection<LoanTransactionRepaymentPeriodData> capitalizedIncomeData,
+            boolean isInterestRecalculationEnabled, LoanScheduleType loanScheduleType);
 
     Collection<LoanTransactionData> retrieveLoanTransactions(Long loanId);
 

fineract-progressive-loan/src/main/java/org/apache/fineract/portfolio/loanaccount/domain/transactionprocessor/impl/AdvancedPaymentScheduleTransactionProcessor.java

@@ -344,6 +344,7 @@ public class AdvancedPaymentScheduleTransactionProcessor extends AbstractLoanRep
             case REAMORTIZE -> handleReAmortization(loanTransaction, ctx);
             case REAGE -> handleReAge(loanTransaction, ctx);
             case ACCRUAL_ACTIVITY -> calculateAccrualActivity(loanTransaction, ctx);
+            case CAPITALIZED_INCOME -> handleCapitalizedIncome(loanTransaction, ctx);
             // TODO: Cover rest of the transaction types
             default -> log.warn("Unhandled transaction processing for transaction type: {}", loanTransaction.getTypeOf());
         }
@@ -1199,18 +1200,7 @@ public class AdvancedPaymentScheduleTransactionProcessor extends AbstractLoanRep
         emiCalculator.addDisbursement(model, transactionDate, amortizableAmount);
 
         disbursementTransaction.resetDerivedComponents();
-        if (amortizableAmount.isGreaterThanZero()) {
+        recalculateRepaymentPeriodsWithEMICalculation(amortizableAmount, model, installments, transactionDate, currency);
-            model.repaymentPeriods().forEach(rm -> {
-                LoanRepaymentScheduleInstallment installment = installments.stream().filter(
-                        ri -> ri.getDueDate().equals(rm.getDueDate()) && !ri.isDownPayment() && !ri.getDueDate().isBefore(transactionDate))
-                        .findFirst().orElse(null);
-                if (installment != null) {
-                    installment.updatePrincipal(rm.getDuePrincipal().getAmount());
-                    installment.updateInterestCharged(rm.getDueInterest().getAmount());
-                    installment.updateObligationsMet(currency, transactionDate);
-                }
-            });
-        }
         allocateOverpayment(disbursementTransaction, transactionCtx);
     }
 
@@ -1222,7 +1212,6 @@ public class AdvancedPaymentScheduleTransactionProcessor extends AbstractLoanRep
         List<LoanRepaymentScheduleInstallment> candidateRepaymentInstallments = installments.stream().filter(
                 i -> i.getDueDate().isAfter(disbursementTransaction.getTransactionDate()) && !i.isDownPayment() && !i.isAdditional())
                 .toList();
-        int noCandidateRepaymentInstallments = candidateRepaymentInstallments.size();
         LoanProductRelatedDetail loanProductRelatedDetail = disbursementTransaction.getLoan().getLoanRepaymentScheduleDetail();
         Integer installmentAmountInMultiplesOf = disbursementTransaction.getLoan().getLoanProduct().getInstallmentAmountInMultiplesOf();
         Money downPaymentAmount = Money.zero(currency);
@@ -1240,7 +1229,73 @@ public class AdvancedPaymentScheduleTransactionProcessor extends AbstractLoanRep
 
         Money amortizableAmount = disbursementTransaction.getAmount(currency).minus(downPaymentAmount);
 
+        recalculateRepaymentInstallmentsWithoutEMICalculation(disbursementTransaction, amortizableAmount, candidateRepaymentInstallments,
+                currency, installmentAmountInMultiplesOf);
+        allocateOverpayment(disbursementTransaction, transactionCtx);
+    }
+
+    private void handleCapitalizedIncome(LoanTransaction capitalizedIncomeTransaction, TransactionCtx transactionCtx) {
+        if (capitalizedIncomeTransaction.getLoan().isInterestBearing()) {
+            handleCapitalizedIncomeWithEMICalculator(capitalizedIncomeTransaction, transactionCtx);
+        } else {
+            handleCapitalizedIncomeWithoutEMICalculator(capitalizedIncomeTransaction, transactionCtx);
+        }
+    }
+
+    private void handleCapitalizedIncomeWithEMICalculator(LoanTransaction capitalizedIncomeTransaction, TransactionCtx transactionCtx) {
+        ProgressiveLoanInterestScheduleModel model;
+        if (!(transactionCtx instanceof ProgressiveTransactionCtx)
+                || (model = ((ProgressiveTransactionCtx) transactionCtx).getModel()) == null) {
+            throw new IllegalStateException("TransactionCtx has no model");
+        }
+        List<LoanRepaymentScheduleInstallment> installments = transactionCtx.getInstallments();
+        LocalDate transactionDate = capitalizedIncomeTransaction.getTransactionDate();
+        MonetaryCurrency currency = transactionCtx.getCurrency();
+
+        Money amortizableAmount = capitalizedIncomeTransaction.getAmount(currency);
+        emiCalculator.addCapitalizedIncome(model, transactionDate, amortizableAmount);
+
+        recalculateRepaymentPeriodsWithEMICalculation(amortizableAmount, model, installments, transactionDate, currency);
+        allocateOverpayment(capitalizedIncomeTransaction, transactionCtx);
+    }
+
+    private void handleCapitalizedIncomeWithoutEMICalculator(LoanTransaction capitalizedIncomeTransaction, TransactionCtx transactionCtx) {
+        MonetaryCurrency currency = transactionCtx.getCurrency();
+        List<LoanRepaymentScheduleInstallment> installments = transactionCtx.getInstallments();
+        List<LoanRepaymentScheduleInstallment> candidateRepaymentInstallments = installments.stream().filter(
+                i -> i.getDueDate().isAfter(capitalizedIncomeTransaction.getTransactionDate()) && !i.isDownPayment() && !i.isAdditional())
+                .toList();
+        Integer installmentAmountInMultiplesOf = capitalizedIncomeTransaction.getLoan().getLoanProduct()
+                .getInstallmentAmountInMultiplesOf();
+
+        Money amortizableAmount = capitalizedIncomeTransaction.getAmount(currency);
+
+        recalculateRepaymentInstallmentsWithoutEMICalculation(capitalizedIncomeTransaction, amortizableAmount,
+                candidateRepaymentInstallments, currency, installmentAmountInMultiplesOf);
+        allocateOverpayment(capitalizedIncomeTransaction, transactionCtx);
+    }
+
+    private void recalculateRepaymentPeriodsWithEMICalculation(Money amortizableAmount, ProgressiveLoanInterestScheduleModel model,
+            List<LoanRepaymentScheduleInstallment> installments, LocalDate transactionDate, MonetaryCurrency currency) {
         if (amortizableAmount.isGreaterThanZero()) {
+            model.repaymentPeriods().forEach(rm -> {
+                LoanRepaymentScheduleInstallment installment = installments.stream().filter(
+                        ri -> ri.getDueDate().equals(rm.getDueDate()) && !ri.isDownPayment() && !ri.getDueDate().isBefore(transactionDate))
+                        .findFirst().orElse(null);
+                if (installment != null) {
+                    installment.updatePrincipal(rm.getDuePrincipal().getAmount());
+                    installment.updateInterestCharged(rm.getDueInterest().getAmount());
+                    installment.updateObligationsMet(currency, transactionDate);
+                }
+            });
+        }
+    }
+
+    private void recalculateRepaymentInstallmentsWithoutEMICalculation(LoanTransaction loanTransaction, Money amortizableAmount,
+            List<LoanRepaymentScheduleInstallment> candidateRepaymentInstallments, MonetaryCurrency currency,
+            Integer installmentAmountInMultiplesOf) {
+        if (amortizableAmount.isGreaterThanZero()) {
+            int noCandidateRepaymentInstallments = candidateRepaymentInstallments.size();
             Money increasePrincipalBy = amortizableAmount.dividedBy(noCandidateRepaymentInstallments, MoneyHelper.getMathContext());
             MoneyHolder moneyHolder = new MoneyHolder(amortizableAmount);
 
@@ -1252,14 +1307,12 @@ public class AdvancedPaymentScheduleTransactionProcessor extends AbstractLoanRep
                 }
                 i.updatePrincipal(newPrincipal.getAmount());
                 moneyHolder.setMoneyObject(moneyHolder.getMoneyObject().minus(newPrincipal).plus(previousPrincipal));
-                i.updateObligationsMet(currency, disbursementTransaction.getTransactionDate());
+                i.updateObligationsMet(currency, loanTransaction.getTransactionDate());
             });
             // Hence the rounding, we might need to amend the last installment amount
-            candidateRepaymentInstallments.get(noCandidateRepaymentInstallments - 1)
+            candidateRepaymentInstallments.get(noCandidateRepaymentInstallments - 1).addToPrincipal(loanTransaction.getTransactionDate(),
-                    .addToPrincipal(disbursementTransaction.getTransactionDate(), moneyHolder.getMoneyObject());
+                    moneyHolder.getMoneyObject());
         }
-
-        allocateOverpayment(disbursementTransaction, transactionCtx);
     }
 
     private void allocateOverpayment(LoanTransaction loanTransaction, TransactionCtx transactionCtx) {

fineract-progressive-loan/src/main/java/org/apache/fineract/portfolio/loanaccount/repository/LoanCapitalizedIncomeBalanceRepository.java

@@ -18,15 +18,29 @@
  */
 package org.apache.fineract.portfolio.loanaccount.repository;
 
+import java.math.BigDecimal;
 import java.util.List;
 import org.apache.fineract.portfolio.loanaccount.domain.LoanCapitalizedIncomeBalance;
+import org.apache.fineract.portfolio.loanaccount.domain.LoanTransactionRepaymentPeriodData;
 import org.springframework.data.jpa.repository.JpaRepository;
 import org.springframework.data.jpa.repository.JpaSpecificationExecutor;
+import org.springframework.data.jpa.repository.Query;
 
 public interface LoanCapitalizedIncomeBalanceRepository
         extends JpaRepository<LoanCapitalizedIncomeBalance, Long>, JpaSpecificationExecutor<LoanCapitalizedIncomeBalance> {
 
+    String FIND_BALANCE_REPAYMENT_SCHEDULE_DATA = "SELECT new org.apache.fineract.portfolio.loanaccount.domain.LoanTransactionRepaymentPeriodData(lcib.loanTransaction.id, lcib.loan.id, lcib.loanTransaction.dateOf, lcib.loanTransaction.reversed, lcib.amount, lcib.unrecognizedAmount, lcib.loanTransaction.feeChargesPortion) FROM LoanCapitalizedIncomeBalance lcib ";
+
     List<LoanCapitalizedIncomeBalance> findAllByLoanId(Long loanId);
 
     LoanCapitalizedIncomeBalance findByLoanIdAndLoanTransactionId(Long loanId, Long transactionId);
+
+    @Query(FIND_BALANCE_REPAYMENT_SCHEDULE_DATA + " WHERE lcib.loan.id = :loanId")
+    List<LoanTransactionRepaymentPeriodData> findRepaymentPeriodDataByLoanId(Long loanId);
+
+    @Query("SELECT SUM(lcib.amount) FROM LoanCapitalizedIncomeBalance lcib WHERE lcib.loan.id = :loanId")
+    BigDecimal calculateCapitalizedIncome(Long loanId);
+
+    @Query("SELECT SUM(lcib.amountAdjustment) FROM LoanCapitalizedIncomeBalance lcib WHERE lcib.loan.id = :loanId")
+    BigDecimal calculateCapitalizedIncomeAdjustment(Long loanId);
 }

fineract-progressive-loan/src/main/java/org/apache/fineract/portfolio/loanaccount/service/CapitalizedIncomeBalanceServiceImpl.java

@@ -0,0 +1,45 @@
+/**
+ * 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.portfolio.loanaccount.service;
+
+import java.math.BigDecimal;
+import lombok.RequiredArgsConstructor;
+import lombok.extern.slf4j.Slf4j;
+import org.apache.fineract.organisation.monetary.domain.Money;
+import org.apache.fineract.portfolio.loanaccount.domain.Loan;
+import org.apache.fineract.portfolio.loanaccount.repository.LoanCapitalizedIncomeBalanceRepository;
+
+@Slf4j
+@RequiredArgsConstructor
+public class CapitalizedIncomeBalanceServiceImpl implements CapitalizedIncomeBalanceService {
+
+    private final LoanCapitalizedIncomeBalanceRepository capitalizedIncomeBalanceRepository;
+
+    @Override
+    public Money calculateCapitalizedIncome(Loan loan) {
+        BigDecimal balance = capitalizedIncomeBalanceRepository.calculateCapitalizedIncome(loan.getId());
+        return Money.of(loan.getCurrency(), balance);
+    }
+
+    @Override
+    public Money calculateCapitalizedIncomeAdjustment(Loan loan) {
+        BigDecimal balance = capitalizedIncomeBalanceRepository.calculateCapitalizedIncomeAdjustment(loan.getId());
+        return Money.of(loan.getCurrency(), balance);
+    }
+}

fineract-progressive-loan/src/main/java/org/apache/fineract/portfolio/loanaccount/service/CapitalizedIncomeWritePlatformServiceImpl.java

@@ -30,6 +30,7 @@ import org.apache.fineract.infrastructure.core.api.JsonCommand;
 import org.apache.fineract.infrastructure.core.data.CommandProcessingResult;
 import org.apache.fineract.infrastructure.core.data.CommandProcessingResultBuilder;
 import org.apache.fineract.infrastructure.core.domain.ExternalId;
+import org.apache.fineract.infrastructure.core.service.DateUtils;
 import org.apache.fineract.infrastructure.core.service.ExternalIdFactory;
 import org.apache.fineract.organisation.monetary.domain.Money;
 import org.apache.fineract.portfolio.loanaccount.domain.Loan;
@@ -54,6 +55,8 @@ public class CapitalizedIncomeWritePlatformServiceImpl implements CapitalizedInc
     private final NoteWritePlatformService noteWritePlatformService;
     private final ExternalIdFactory externalIdFactory;
     private final LoanCapitalizedIncomeBalanceRepository capitalizedIncomeBalanceRepository;
+    private final ReprocessLoanTransactionsService reprocessLoanTransactionsService;
+    private final LoanBalanceService loanBalanceService;
 
     @Transactional
     @Override
@@ -74,21 +77,24 @@ public class CapitalizedIncomeWritePlatformServiceImpl implements CapitalizedInc
         final Money capitalizedIncomeAmount = calculateCapitalizedIncomeAmount(loan, transactionAmount);
         final LoanTransaction capitalizedIncomeTransaction = LoanTransaction.capitalizedIncome(loan, capitalizedIncomeAmount, paymentDetail,
                 transactionDate, txnExternalId);
-        // TODO: Transaction reverse-replay + loan repayment schedule update (follow-up story)
         // Update loan with capitalized income
         loan.addLoanTransaction(capitalizedIncomeTransaction);
+        // Recalculate loan transactions
+        recalculateLoanTransactions(loan, transactionDate, capitalizedIncomeTransaction);
         // Create capitalized income balances
         createCapitalizedIncomeBalance(capitalizedIncomeTransaction);
         // Save and flush (PK is set)
         loanTransactionRepository.saveAndFlush(capitalizedIncomeTransaction);
+        // Create capitalized income balances
+        createCapitalizedIncomeBalance(capitalizedIncomeTransaction);
         // Update loan counters and save
         loan.updateLoanScheduleDependentDerivedFields();
-        // Update outstanding loan balances
+        // Update loan summary data
-        loan.updateLoanOutstandingBalances();
+        loanBalanceService.updateLoanSummaryDerivedFields(loan);
         // Create a note if provided
         final String noteText = command.stringValueOfParameterNamed("note");
         if (noteText != null && !noteText.isEmpty()) {
-            noteWritePlatformService.createLoanNote(loanId, noteText);
+            noteWritePlatformService.createLoanTransactionNote(capitalizedIncomeTransaction.getId(), noteText);
         }
         // Post journal entries
         journalEntryPoster.postJournalEntries(loan, existingTransactionIds, existingReversedTransactionIds);
@@ -99,6 +105,14 @@ public class CapitalizedIncomeWritePlatformServiceImpl implements CapitalizedInc
                 .build();
     }
 
+    private void recalculateLoanTransactions(Loan loan, LocalDate transactionDate, LoanTransaction capitalizedIncomeTransaction) {
+        if (loan.isInterestBearingAndInterestRecalculationEnabled() || DateUtils.isBeforeBusinessDate(transactionDate)) {
+            reprocessLoanTransactionsService.reprocessTransactions(loan);
+        } else {
+            reprocessLoanTransactionsService.processLatestTransaction(capitalizedIncomeTransaction, loan);
+        }
+    }
+
     @Override
     public void resetBalance(final Long loanId) {
         capitalizedIncomeBalanceRepository

fineract-progressive-loan/src/main/java/org/apache/fineract/portfolio/loanaccount/starter/ProgressiveLoanAccountConfiguration.java

@@ -24,12 +24,16 @@ import org.apache.fineract.portfolio.loanaccount.domain.LoanRepositoryWrapper;
 import org.apache.fineract.portfolio.loanaccount.domain.LoanTransactionRepository;
 import org.apache.fineract.portfolio.loanaccount.repository.LoanCapitalizedIncomeBalanceRepository;
 import org.apache.fineract.portfolio.loanaccount.serialization.LoanTransactionValidator;
+import org.apache.fineract.portfolio.loanaccount.service.CapitalizedIncomeBalanceService;
+import org.apache.fineract.portfolio.loanaccount.service.CapitalizedIncomeBalanceServiceImpl;
 import org.apache.fineract.portfolio.loanaccount.service.CapitalizedIncomePlatformService;
 import org.apache.fineract.portfolio.loanaccount.service.CapitalizedIncomeWritePlatformServiceImpl;
 import org.apache.fineract.portfolio.loanaccount.service.LoanAssembler;
+import org.apache.fineract.portfolio.loanaccount.service.LoanBalanceService;
 import org.apache.fineract.portfolio.loanaccount.service.LoanJournalEntryPoster;
 import org.apache.fineract.portfolio.loanaccount.service.ProgressiveLoanTransactionValidator;
 import org.apache.fineract.portfolio.loanaccount.service.ProgressiveLoanTransactionValidatorImpl;
+import org.apache.fineract.portfolio.loanaccount.service.ReprocessLoanTransactionsService;
 import org.apache.fineract.portfolio.note.service.NoteWritePlatformService;
 import org.apache.fineract.portfolio.paymentdetail.service.PaymentDetailWritePlatformService;
 import org.springframework.boot.autoconfigure.condition.ConditionalOnMissingBean;
@@ -45,10 +49,11 @@ public class ProgressiveLoanAccountConfiguration {
             LoanAssembler loanAssembler, LoanTransactionRepository loanTransactionRepository,
             PaymentDetailWritePlatformService paymentDetailWritePlatformService, LoanJournalEntryPoster journalEntryPoster,
             NoteWritePlatformService noteWritePlatformService, ExternalIdFactory externalIdFactory,
-            LoanCapitalizedIncomeBalanceRepository capitalizedIncomeBalanceRepository) {
+            LoanCapitalizedIncomeBalanceRepository capitalizedIncomeBalanceRepository,
+            ReprocessLoanTransactionsService reprocessLoanTransactionsService, LoanBalanceService loanBalanceService) {
         return new CapitalizedIncomeWritePlatformServiceImpl(loanTransactionValidator, loanAssembler, loanTransactionRepository,
                 paymentDetailWritePlatformService, journalEntryPoster, noteWritePlatformService, externalIdFactory,
-                capitalizedIncomeBalanceRepository);
+                capitalizedIncomeBalanceRepository, reprocessLoanTransactionsService, loanBalanceService);
     }
 
     @Bean
@@ -59,4 +64,11 @@ public class ProgressiveLoanAccountConfiguration {
         return new ProgressiveLoanTransactionValidatorImpl(fromApiJsonHelper, loanTransactionValidator, loanRepositoryWrapper,
                 loanCapitalizedIncomeBalanceRepository);
     }
+
+    @Bean
+    @ConditionalOnMissingBean(CapitalizedIncomeBalanceService.class)
+    public CapitalizedIncomeBalanceService capitalizedIncomeBalanceService(
+            LoanCapitalizedIncomeBalanceRepository loanCapitalizedIncomeBalanceRepository) {
+        return new CapitalizedIncomeBalanceServiceImpl(loanCapitalizedIncomeBalanceRepository);
+    }
 }

fineract-progressive-loan/src/main/java/org/apache/fineract/portfolio/loanproduct/calc/EMICalculator.java

@@ -65,6 +65,12 @@ public interface EMICalculator {
      */
     void addDisbursement(ProgressiveLoanInterestScheduleModel scheduleModel, LocalDate disbursementDueDate, Money disbursedAmount);
 
+    /**
+     * Applies the capitalized income transaction on the interest model. This method recalculates the EMI amounts from
+     * the action date.
+     */
+    void addCapitalizedIncome(ProgressiveLoanInterestScheduleModel scheduleModel, LocalDate transactionDueDate, Money transactionAmount);
+
     /**
      * Applies the interest rate change on the interest model. This method recalculates the EMI amounts from the action
      * date.

fineract-progressive-loan/src/main/java/org/apache/fineract/portfolio/loanproduct/calc/ProgressiveEMICalculator.java

@@ -119,7 +119,7 @@ public final class ProgressiveEMICalculator implements EMICalculator {
     private void addDisbursement(final ProgressiveLoanInterestScheduleModel scheduleModel, final EmiChangeOperation operation) {
         scheduleModel
                 .changeOutstandingBalanceAndUpdateInterestPeriods(operation.getSubmittedOnDate(), operation.getAmount(),
-                        scheduleModel.zero())
+                        scheduleModel.zero(), scheduleModel.zero())
                 .ifPresent((repaymentPeriod) -> calculateEMIValueAndRateFactors(
                         getEffectiveRepaymentDueDate(scheduleModel, repaymentPeriod, operation.getSubmittedOnDate()), scheduleModel,
                         operation));
@@ -140,6 +140,24 @@ public final class ProgressiveEMICalculator implements EMICalculator {
         return changedRepaymentPeriod.getDueDate();
     }
 
+    /**
+     * Add capitalized income to Interest Period
+     */
+    @Override
+    public void addCapitalizedIncome(final ProgressiveLoanInterestScheduleModel scheduleModel, final LocalDate transactionDueDate,
+            final Money transactionAmount) {
+        addCapitalizedIncome(scheduleModel, EmiChangeOperation.capitalizedIncome(transactionDueDate, transactionAmount));
+    }
+
+    private void addCapitalizedIncome(final ProgressiveLoanInterestScheduleModel scheduleModel, final EmiChangeOperation operation) {
+        scheduleModel.changeOutstandingBalanceAndUpdateInterestPeriods(operation.getSubmittedOnDate(), scheduleModel.zero(),
+                scheduleModel.zero(), operation.getAmount()).ifPresent((repaymentPeriod) -> {
+                    calculateEMIValueAndRateFactors(
+                            getEffectiveRepaymentDueDate(scheduleModel, repaymentPeriod, operation.getSubmittedOnDate()), scheduleModel,
+                            operation);
+                });
+    }
+
     @Override
     public void changeInterestRate(final ProgressiveLoanInterestScheduleModel scheduleModel, final LocalDate newInterestSubmittedOnDate,
             final BigDecimal newInterestRate) {
@@ -151,7 +169,7 @@ public final class ProgressiveEMICalculator implements EMICalculator {
         scheduleModel.addInterestRate(interestRateChangeEffectiveDate, operation.getInterestRate());
         scheduleModel
                 .changeOutstandingBalanceAndUpdateInterestPeriods(interestRateChangeEffectiveDate, scheduleModel.zero(),
-                        scheduleModel.zero())
+                        scheduleModel.zero(), scheduleModel.zero())
                 .ifPresent(repaymentPeriod -> calculateEMIValueAndRateFactors(
                         getEffectiveRepaymentDueDate(scheduleModel, repaymentPeriod, interestRateChangeEffectiveDate), scheduleModel,
                         operation));
@@ -160,8 +178,8 @@ public final class ProgressiveEMICalculator implements EMICalculator {
     @Override
     public void addBalanceCorrection(ProgressiveLoanInterestScheduleModel scheduleModel, LocalDate balanceCorrectionDate,
             Money balanceCorrectionAmount) {
-        scheduleModel.changeOutstandingBalanceAndUpdateInterestPeriods(balanceCorrectionDate, scheduleModel.zero(), balanceCorrectionAmount)
+        scheduleModel.changeOutstandingBalanceAndUpdateInterestPeriods(balanceCorrectionDate, scheduleModel.zero(), balanceCorrectionAmount,
-                .ifPresent(repaymentPeriod -> {
+                scheduleModel.zero()).ifPresent(repaymentPeriod -> {
                     calculateRateFactorForRepaymentPeriod(repaymentPeriod, scheduleModel);
                     calculateOutstandingBalance(scheduleModel);
                     calculateLastUnpaidRepaymentPeriodEMI(scheduleModel);
@@ -237,7 +255,7 @@ public final class ProgressiveEMICalculator implements EMICalculator {
 
     private void addCredit(ProgressiveLoanInterestScheduleModel scheduleModel, LocalDate transactionDate, Money creditedPrincipalAmount,
             Money creditedInterestAmount) {
-        scheduleModel.changeOutstandingBalanceAndUpdateInterestPeriods(transactionDate, scheduleModel.zero(), creditedPrincipalAmount)
+        scheduleModel.changeOutstandingBalanceAndUpdateInterestPeriods(transactionDate, scheduleModel.zero(), creditedPrincipalAmount, scheduleModel.zero())
                 .ifPresent(repaymentPeriod -> {
                     addCreditedAmountsToInterestPeriod(scheduleModel, transactionDate, creditedPrincipalAmount, creditedInterestAmount);
                     calculateRateFactorForRepaymentPeriod(repaymentPeriod, scheduleModel);
@@ -440,10 +458,13 @@ public final class ProgressiveEMICalculator implements EMICalculator {
                 .reduce(scheduleModel.zero(), (m1, m2) -> m1.plus(m2, mc)); // 101.48
         Money totalDisbursedAmount = scheduleModel.repaymentPeriods().stream()
                 .flatMap(rp -> rp.getInterestPeriods().stream().map(InterestPeriod::getDisbursementAmount))
-                .reduce(scheduleModel.zero(), (m1, m2) -> m1.plus(m2, mc)) // 100
+                .reduce(scheduleModel.zero(), (m1, m2) -> m1.plus(m2, mc)); // 100
-                .plus(scheduleModel.getTotalCreditedPrincipal(), mc); //
+        Money totalCapitalizedIncome = scheduleModel.repaymentPeriods().stream()
+                .flatMap(rp -> rp.getInterestPeriods().stream().map(InterestPeriod::getCapitalizedIncomePrincipal))
+                .reduce(scheduleModel.zero(), (m1, m2) -> m1.plus(m2, mc)); // 100
 
-        Money diff = totalDisbursedAmount.plus(totalDueInterest, mc).minus(totalEMI, mc);
+        Money diff = totalDisbursedAmount.plus(totalCapitalizedIncome, mc).plus(scheduleModel.getTotalCreditedPrincipal(), mc)
+                .plus(totalDueInterest, mc).minus(totalEMI, mc);
         Optional<RepaymentPeriod> findLastUnpaidRepaymentPeriod = scheduleModel.repaymentPeriods().stream().filter(rp -> !rp.isFullyPaid())
                 .reduce((first, second) -> second);
         findLastUnpaidRepaymentPeriod.ifPresent(repaymentPeriod -> {
@@ -809,7 +830,9 @@ public final class ProgressiveEMICalculator implements EMICalculator {
             return;
         }
         final ProgressiveLoanInterestScheduleModel scheduleModelCopy = scheduleModel.copyWithoutPaidAmounts();
+
         addDisbursement(scheduleModelCopy, operation.withZeroAmount());
+        addCapitalizedIncome(scheduleModelCopy, operation.withZeroAmount());
 
         final LocalDate firstDueDate = repaymentPeriods.get(0).getDueDate();
         scheduleModel.copyPeriodsFrom(firstDueDate, scheduleModelCopy.repaymentPeriods(), (newRepaymentPeriod, actualRepaymentPeriod) -> {

fineract-progressive-loan/src/main/java/org/apache/fineract/portfolio/loanproduct/calc/data/EmiChangeOperation.java

@@ -31,7 +31,9 @@ public class EmiChangeOperation {
 
     public enum Action { //
         DISBURSEMENT, //
-        INTEREST_RATE_CHANGE //
+        INTEREST_RATE_CHANGE, //
+        CAPITALIZED_INCOME, //
+        ;
     }
 
     private final Action action;
@@ -48,8 +50,12 @@ public class EmiChangeOperation {
         return new EmiChangeOperation(EmiChangeOperation.Action.INTEREST_RATE_CHANGE, newInterestSubmittedOnDate, null, newInterestRate);
     }
 
+    public static EmiChangeOperation capitalizedIncome(final LocalDate transactionDueDate, final Money transactionAmount) {
+        return new EmiChangeOperation(Action.CAPITALIZED_INCOME, transactionDueDate, transactionAmount, null);
+    }
+
     public EmiChangeOperation withZeroAmount() {
-        if (action == Action.DISBURSEMENT) {
+        if (action == Action.DISBURSEMENT || action == Action.CAPITALIZED_INCOME) {
             return new EmiChangeOperation(action, submittedOnDate, amount.zero(), null);
         }
         return null;

fineract-progressive-loan/src/main/java/org/apache/fineract/portfolio/loanproduct/calc/data/InterestPeriod.java

@@ -62,6 +62,8 @@ public class InterestPeriod implements Comparable<InterestPeriod> {
     private Money balanceCorrectionAmount;
     private Money outstandingLoanBalance;
 
+    private Money capitalizedIncomePrincipal;
+
     @JsonExclude
     private final MathContext mc;
     private final boolean isPaused;
@@ -70,38 +72,38 @@ public class InterestPeriod implements Comparable<InterestPeriod> {
         return new InterestPeriod(repaymentPeriod, interestPeriod.getFromDate(), interestPeriod.getDueDate(),
                 interestPeriod.getRateFactor(), interestPeriod.getRateFactorTillPeriodDueDate(), interestPeriod.getCreditedPrincipal(),
                 interestPeriod.getCreditedInterest(), interestPeriod.getDisbursementAmount(), interestPeriod.getBalanceCorrectionAmount(),
-                interestPeriod.getOutstandingLoanBalance(), mc, interestPeriod.isPaused());
+                interestPeriod.getOutstandingLoanBalance(), interestPeriod.getCapitalizedIncomePrincipal(), mc, interestPeriod.isPaused());
     }
 
     public static InterestPeriod empty(@NotNull RepaymentPeriod repaymentPeriod, MathContext mc) {
-        return new InterestPeriod(repaymentPeriod, null, null, null, null, null, null, null, null, null, mc, false);
+        return new InterestPeriod(repaymentPeriod, null, null, null, null, null, null, null, null, null,null, mc, false);
     }
 
     public static InterestPeriod copy(@NotNull RepaymentPeriod repaymentPeriod, @NotNull InterestPeriod interestPeriod) {
         return new InterestPeriod(repaymentPeriod, interestPeriod.getFromDate(), interestPeriod.getDueDate(),
                 interestPeriod.getRateFactor(), interestPeriod.getRateFactorTillPeriodDueDate(), interestPeriod.getCreditedPrincipal(),
                 interestPeriod.getCreditedInterest(), interestPeriod.getDisbursementAmount(), interestPeriod.getBalanceCorrectionAmount(),
-                interestPeriod.getOutstandingLoanBalance(), interestPeriod.getMc(), interestPeriod.isPaused());
+                interestPeriod.getOutstandingLoanBalance(), interestPeriod.getCapitalizedIncomePrincipal(), interestPeriod.getMc(), interestPeriod.isPaused());
     }
 
     public static InterestPeriod withEmptyAmounts(@NotNull RepaymentPeriod repaymentPeriod, @NotNull LocalDate fromDate,
             LocalDate dueDate) {
         final Money zero = repaymentPeriod.getEmi().zero();
-        return new InterestPeriod(repaymentPeriod, fromDate, dueDate, BigDecimal.ZERO, BigDecimal.ZERO, zero, zero, zero, zero, zero,
+        return new InterestPeriod(repaymentPeriod, fromDate, dueDate, BigDecimal.ZERO, BigDecimal.ZERO, zero, zero, zero, zero, zero, zero,
                 zero.getMc(), false);
     }
 
     public static InterestPeriod withEmptyAmounts(@NotNull RepaymentPeriod repaymentPeriod, @NotNull LocalDate fromDate, LocalDate dueDate,
             boolean isPaused) {
         final Money zero = repaymentPeriod.getEmi().zero();
-        return new InterestPeriod(repaymentPeriod, fromDate, dueDate, BigDecimal.ZERO, BigDecimal.ZERO, zero, zero, zero, zero, zero,
+        return new InterestPeriod(repaymentPeriod, fromDate, dueDate, BigDecimal.ZERO, BigDecimal.ZERO, zero, zero, zero, zero, zero, zero,
                 zero.getMc(), isPaused);
     }
 
     public static InterestPeriod withPausedAndEmptyAmounts(@NotNull RepaymentPeriod repaymentPeriod, @NotNull LocalDate fromDate,
             LocalDate dueDate) {
         final Money zero = repaymentPeriod.getEmi().zero();
-        return new InterestPeriod(repaymentPeriod, fromDate, dueDate, BigDecimal.ZERO, BigDecimal.ZERO, zero, zero, zero, zero, zero,
+        return new InterestPeriod(repaymentPeriod, fromDate, dueDate, BigDecimal.ZERO, BigDecimal.ZERO, zero, zero, zero, zero, zero, zero,
                 zero.getMc(), true);
     }
 
@@ -126,6 +128,10 @@ public class InterestPeriod implements Comparable<InterestPeriod> {
         this.creditedInterest = MathUtil.plus(this.creditedInterest, creditedInterest, mc);
     }
 
+    public void addCapitalizedIncomePrincipalAmount(final Money capitalizedIncomePrincipal) {
+        this.capitalizedIncomePrincipal = MathUtil.plus(this.capitalizedIncomePrincipal, capitalizedIncomePrincipal, mc);
+    }
+
     public BigDecimal getCalculatedDueInterest() {
         if (isPaused) {
             return creditedInterest.getAmount();
@@ -156,6 +162,7 @@ public class InterestPeriod implements Comparable<InterestPeriod> {
                 InterestPeriod previousInterestPeriod = previousRepaymentPeriod.get().getLastInterestPeriod();
                 this.outstandingLoanBalance = MathUtil.negativeToZero(previousInterestPeriod.getOutstandingLoanBalance()//
                         .plus(previousInterestPeriod.getDisbursementAmount(), mc)//
+                        .plus(previousInterestPeriod.getCapitalizedIncomePrincipal(), mc)//
                         .plus(previousInterestPeriod.getBalanceCorrectionAmount(), mc)//
                         .minus(previousRepaymentPeriod.get().getDuePrincipal(), mc)//
                         .plus(previousRepaymentPeriod.get().getPaidPrincipal(), mc), mc);//
@@ -165,6 +172,7 @@ public class InterestPeriod implements Comparable<InterestPeriod> {
             InterestPeriod previousInterestPeriod = getRepaymentPeriod().getInterestPeriods().get(index - 1);
             this.outstandingLoanBalance = MathUtil.negativeToZero(previousInterestPeriod.getOutstandingLoanBalance() //
                     .plus(previousInterestPeriod.getBalanceCorrectionAmount(), mc) //
+                    .plus(previousInterestPeriod.getCapitalizedIncomePrincipal(), mc) //
                     .plus(previousInterestPeriod.getDisbursementAmount(), mc)); //
         }
     }
@@ -173,7 +181,7 @@ public class InterestPeriod implements Comparable<InterestPeriod> {
      * Include principal like amounts (all disbursement amount + credited principal)
      */
     public Money getCreditedAmounts() {
-        return getDisbursementAmount().plus(getCreditedPrincipal(), mc);
+        return getDisbursementAmount().plus(getCreditedPrincipal(), mc).plus(getCapitalizedIncomePrincipal(), mc);
     }
 
     public boolean isFirstInterestPeriod() {

fineract-progressive-loan/src/main/java/org/apache/fineract/portfolio/loanproduct/calc/data/ProgressiveLoanInterestScheduleModel.java

@@ -175,9 +175,10 @@ public class ProgressiveLoanInterestScheduleModel {
     }
 
     public Optional<RepaymentPeriod> changeOutstandingBalanceAndUpdateInterestPeriods(final LocalDate balanceChangeDate,
-            final Money disbursedAmount, final Money correctionAmount) {
+            final Money disbursedAmount, final Money correctionAmount, final Money capitalizedIncomePrincipal) {
         return findRepaymentPeriodForBalanceChange(balanceChangeDate).stream()//
-                .peek(updateInterestPeriodOnRepaymentPeriod(balanceChangeDate, disbursedAmount, correctionAmount))//
+                .peek(updateInterestPeriodOnRepaymentPeriod(balanceChangeDate, disbursedAmount, correctionAmount,
+                        capitalizedIncomePrincipal))//
                 .findFirst();//
     }
 
@@ -214,7 +215,7 @@ public class ProgressiveLoanInterestScheduleModel {
     }
 
     private Consumer<RepaymentPeriod> updateInterestPeriodOnRepaymentPeriod(final LocalDate balanceChangeDate, final Money disbursedAmount,
-            final Money correctionAmount) {
+            final Money correctionAmount, final Money capitalizedIncomePrincipal) {
         return repaymentPeriod -> {
             final boolean isChangeOnMaturityDate = isLastRepaymentPeriod(repaymentPeriod)
                     && balanceChangeDate.isEqual(repaymentPeriod.getDueDate());
@@ -222,9 +223,10 @@ public class ProgressiveLoanInterestScheduleModel {
                     isChangeOnMaturityDate);
             if (interestPeriodOptional.isPresent()) {
                 interestPeriodOptional.get().addDisbursementAmount(disbursedAmount);
+                interestPeriodOptional.get().addCapitalizedIncomePrincipalAmount(capitalizedIncomePrincipal);
                 interestPeriodOptional.get().addBalanceCorrectionAmount(correctionAmount);
             } else {
-                insertInterestPeriod(repaymentPeriod, balanceChangeDate, disbursedAmount, correctionAmount);
+                insertInterestPeriod(repaymentPeriod, balanceChangeDate, disbursedAmount, correctionAmount, capitalizedIncomePrincipal);
             }
         };
     }
@@ -246,7 +248,7 @@ public class ProgressiveLoanInterestScheduleModel {
     }
 
     void insertInterestPeriod(final RepaymentPeriod repaymentPeriod, final LocalDate balanceChangeDate, final Money disbursedAmount,
-            final Money correctionAmount) {
+            final Money correctionAmount, Money capitalizedIncomePrincipal) {
         final InterestPeriod previousInterestPeriod = findPreviousInterestPeriod(repaymentPeriod, balanceChangeDate);
         final LocalDate originalDueDate = previousInterestPeriod.getDueDate();
         final LocalDate newDueDate = calculateNewDueDate(previousInterestPeriod, balanceChangeDate);
@@ -254,6 +256,7 @@ public class ProgressiveLoanInterestScheduleModel {
 
         previousInterestPeriod.setDueDate(newDueDate);
         previousInterestPeriod.addDisbursementAmount(disbursedAmount);
+        previousInterestPeriod.addCapitalizedIncomePrincipalAmount(capitalizedIncomePrincipal);
         previousInterestPeriod.addBalanceCorrectionAmount(correctionAmount);
 
         final InterestPeriod interestPeriod = InterestPeriod.withEmptyAmounts(repaymentPeriod, newDueDate, originalDueDate, isPaused);

fineract-progressive-loan/src/main/java/org/apache/fineract/portfolio/loanproduct/calc/data/RepaymentPeriod.java

@@ -225,6 +225,17 @@ public final class RepaymentPeriod {
                 .reduce(getZero(mc), (value, previous) -> value.plus(previous, mc)), mc); //
     }
 
+    /**
+     * Sum of capitalized income principals
+     *
+     * @return
+     */
+    public Money getCapitalizedIncomePrincipal() {
+        return MathUtil.negativeToZero(interestPeriods.stream() //
+                .map(InterestPeriod::getCapitalizedIncomePrincipal) //
+                .reduce(getZero(mc), (value, previous) -> value.plus(previous, mc)), mc); //
+    }
+
     /**
      * Gives back due principal + credited principal or paid principal
      *
@@ -278,6 +289,7 @@ public final class RepaymentPeriod {
                 InterestPeriod lastInterestPeriod = getInterestPeriods().get(getInterestPeriods().size() - 1);
                 Money calculatedOutStandingLoanBalance = lastInterestPeriod.getOutstandingLoanBalance() //
                         .plus(lastInterestPeriod.getBalanceCorrectionAmount(), mc) //
+                        .plus(lastInterestPeriod.getCapitalizedIncomePrincipal(), mc) //
                         .plus(lastInterestPeriod.getDisbursementAmount(), mc) //
                         .minus(getDuePrincipal(), mc)//
                         .plus(getPaidPrincipal(), mc);//
@@ -305,7 +317,10 @@ public final class RepaymentPeriod {
         Money totalDisbursedAmount = getInterestPeriods().stream() //
                 .map(InterestPeriod::getDisbursementAmount) //
                 .reduce(getZero(mc), (m1, m2) -> m1.plus(m2, mc)); //
-        return initialBalance.add(totalDisbursedAmount, mc);
+        Money totalCapitalizedIncomeAmount = getInterestPeriods().stream() //
+                .map(InterestPeriod::getCapitalizedIncomePrincipal) //
+                .reduce(getZero(mc), (m1, m2) -> m1.plus(m2, mc)); //
+        return initialBalance.add(totalDisbursedAmount, mc).add(totalCapitalizedIncomeAmount, mc);
     }
 
     private Money getZero(MathContext mc) {

fineract-provider/src/main/java/org/apache/fineract/infrastructure/bulkimport/importhandler/loan/LoanImportHandler.java

@@ -464,6 +464,7 @@ public class LoanImportHandler implements ImportHandler {
         JsonObject loanRepaymentJsonob = gsonBuilder.create().toJsonTree(loanRepayments.get(rowIndex)).getAsJsonObject();
         loanRepaymentJsonob.remove("manuallyReversed");
         loanRepaymentJsonob.remove("numberOfRepayments");
+        loanRepaymentJsonob.remove("reversed");
         String payload = loanRepaymentJsonob.toString();
         final CommandWrapper commandRequest = new CommandWrapperBuilder() //
                 .loanRepaymentTransaction(result.getLoanId()) //

fineract-provider/src/main/java/org/apache/fineract/portfolio/loanaccount/api/LoansApiResource.java

@@ -139,6 +139,7 @@ import org.apache.fineract.portfolio.loanaccount.domain.LoanCapitalizedIncomeTyp
 import org.apache.fineract.portfolio.loanaccount.domain.LoanStatus;
 import org.apache.fineract.portfolio.loanaccount.domain.LoanSummaryBalancesRepository;
 import org.apache.fineract.portfolio.loanaccount.domain.LoanTermVariationType;
+import org.apache.fineract.portfolio.loanaccount.domain.LoanTransactionRepaymentPeriodData;
 import org.apache.fineract.portfolio.loanaccount.exception.LoanNotFoundException;
 import org.apache.fineract.portfolio.loanaccount.exception.LoanTemplateTypeRequiredException;
 import org.apache.fineract.portfolio.loanaccount.exception.NotSupportedLoanTemplateTypeException;
@@ -150,6 +151,7 @@ import org.apache.fineract.portfolio.loanaccount.loanschedule.domain.LoanSchedul
 import org.apache.fineract.portfolio.loanaccount.loanschedule.domain.LoanScheduleType;
 import org.apache.fineract.portfolio.loanaccount.loanschedule.service.LoanScheduleCalculationPlatformService;
 import org.apache.fineract.portfolio.loanaccount.loanschedule.service.LoanScheduleHistoryReadPlatformService;
+import org.apache.fineract.portfolio.loanaccount.repository.LoanCapitalizedIncomeBalanceRepository;
 import org.apache.fineract.portfolio.loanaccount.rescheduleloan.domain.LoanTermVariationsRepository;
 import org.apache.fineract.portfolio.loanaccount.service.GLIMAccountInfoReadPlatformService;
 import org.apache.fineract.portfolio.loanaccount.service.LoanChargeReadPlatformService;
@@ -297,6 +299,7 @@ public class LoansApiResource {
     private final ClientReadPlatformService clientReadPlatformService;
     private final LoanTermVariationsRepository loanTermVariationsRepository;
     private final LoanSummaryProviderDelegate loanSummaryProviderDelegate;
+    private final LoanCapitalizedIncomeBalanceRepository loanCapitalizedIncomeBalanceRepository;
 
     /*
      * This template API is used for loan approval, ideally this should be invoked on loan that are pending for
@@ -498,11 +501,13 @@ public class LoansApiResource {
             loanBasicDetails.getPageItems().forEach(i -> {
                 if (i.getSummary() != null) {
                     Collection<DisbursementData> disbursementData = this.loanReadPlatformService.retrieveLoanDisbursementDetails(i.getId());
+                    List<LoanTransactionRepaymentPeriodData> capitalizedIncomeData = this.loanCapitalizedIncomeBalanceRepository
+                            .findRepaymentPeriodDataByLoanId(i.getId());
                     final RepaymentScheduleRelatedLoanData repaymentScheduleRelatedData = new RepaymentScheduleRelatedLoanData(
                             i.getTimeline().getExpectedDisbursementDate(), i.getTimeline().getActualDisbursementDate(), i.getCurrency(),
                             i.getPrincipal(), i.getInArrearsTolerance(), i.getFeeChargesAtDisbursementCharged());
                     final LoanScheduleData repaymentSchedule = this.loanReadPlatformService.retrieveRepaymentSchedule(i.getId(),
-                            repaymentScheduleRelatedData, disbursementData, i.isInterestRecalculationEnabled(),
+                            repaymentScheduleRelatedData, disbursementData, capitalizedIncomeData, i.isInterestRecalculationEnabled(),
                             LoanScheduleType.fromEnumOptionData(i.getLoanScheduleType()));
                     LoanSummaryDataProvider loanSummaryDataProvider = loanSummaryProviderDelegate
                             .resolveLoanSummaryDataProvider(i.getTransactionProcessingStrategyCode());
@@ -981,13 +986,15 @@ public class LoansApiResource {
 
             if (associationParameters.contains(DataTableApiConstant.repaymentScheduleAssociateParamName)) {
                 mandatoryResponseParameters.add(DataTableApiConstant.repaymentScheduleAssociateParamName);
+                List<LoanTransactionRepaymentPeriodData> capitalizedIncomeData = this.loanCapitalizedIncomeBalanceRepository
+                        .findRepaymentPeriodDataByLoanId(resolvedLoanId);
                 final RepaymentScheduleRelatedLoanData repaymentScheduleRelatedData = new RepaymentScheduleRelatedLoanData(
                         loanBasicDetails.getTimeline().getExpectedDisbursementDate(),
                         loanBasicDetails.getTimeline().getActualDisbursementDate(), loanBasicDetails.getCurrency(),
                         loanBasicDetails.getPrincipal(), loanBasicDetails.getInArrearsTolerance(),
                         loanBasicDetails.getFeeChargesAtDisbursementCharged());
                 repaymentSchedule = this.loanReadPlatformService.retrieveRepaymentSchedule(resolvedLoanId, repaymentScheduleRelatedData,
-                        disbursementData, loanBasicDetails.isInterestRecalculationEnabled(),
+                        disbursementData, capitalizedIncomeData, loanBasicDetails.isInterestRecalculationEnabled(),
                         LoanScheduleType.fromEnumOptionData(loanBasicDetails.getLoanScheduleType()));
 
                 if (associationParameters.contains(DataTableApiConstant.futureScheduleAssociateParamName)

fineract-provider/src/main/java/org/apache/fineract/portfolio/loanaccount/api/LoansApiResourceSwagger.java

@@ -517,7 +517,11 @@ final class LoansApiResourceSwagger {
 
             public GetLoansLoanIdCurrency currency;
             @Schema(example = "1000000.000000")
+            public BigDecimal totalPrincipal;
+            @Schema(example = "1000000.000000")
             public BigDecimal principalDisbursed;
+            @Schema(example = "1000000.000000")
+            public BigDecimal totalCapitalizedIncome;
             @Schema(example = "0.000000")
             public BigDecimal principalPaid;
             @Schema(example = "0.00")

fineract-provider/src/main/java/org/apache/fineract/portfolio/loanaccount/service/CommonLoanSummaryDataProvider.java

@@ -97,7 +97,9 @@ public abstract class CommonLoanSummaryDataProvider implements LoanSummaryDataPr
         }
 
         return LoanSummaryData.builder().currency(defaultSummaryData.getCurrency())
-                .principalDisbursed(defaultSummaryData.getPrincipalDisbursed())
+                .principalDisbursed(defaultSummaryData.getPrincipalDisbursed()).totalPrincipal(defaultSummaryData.getTotalPrincipal())
+                .totalCapitalizedIncome(defaultSummaryData.getTotalCapitalizedIncome())
+                .totalCapitalizedIncomeAdjustment(defaultSummaryData.getTotalCapitalizedIncomeAdjustment())
                 .principalAdjustments(defaultSummaryData.getPrincipalAdjustments()).principalPaid(defaultSummaryData.getPrincipalPaid())
                 .principalWrittenOff(defaultSummaryData.getPrincipalWrittenOff())
                 .principalOutstanding(defaultSummaryData.getPrincipalOutstanding())

fineract-provider/src/main/java/org/apache/fineract/portfolio/loanaccount/service/LoanCapitalizedIncomeAmortizationProcessingServiceImpl.java

@@ -21,10 +21,12 @@ package org.apache.fineract.portfolio.loanaccount.service;
 import java.math.BigDecimal;
 import java.time.LocalDate;
 import java.util.List;
+import java.util.Optional;
 import lombok.RequiredArgsConstructor;
 import org.apache.fineract.infrastructure.configuration.domain.ConfigurationDomainService;
 import org.apache.fineract.infrastructure.core.domain.ExternalId;
 import org.apache.fineract.infrastructure.core.service.DateUtils;
+import org.apache.fineract.infrastructure.core.service.MathUtil;
 import org.apache.fineract.infrastructure.event.business.domain.loan.LoanAdjustTransactionBusinessEvent;
 import org.apache.fineract.infrastructure.event.business.domain.loan.transaction.LoanCapitalizedIncomeAmortizationTransactionCreatedBusinessEvent;
 import org.apache.fineract.infrastructure.event.business.service.BusinessEventNotifierService;
@@ -51,9 +53,10 @@ public class LoanCapitalizedIncomeAmortizationProcessingServiceImpl implements L
     @Transactional
     public void processCapitalizedIncomeAmortizationOnLoanClosure(@NotNull final Loan loan) {
         final LocalDate transactionDate = getFinalCapitalizedIncomeAmortizationTransactionDate(loan);
-        final LoanTransaction amortizationTransaction = createCapitalizedIncomeAmortizationTransaction(loan, transactionDate, false);
+        final Optional<LoanTransaction> amortizationTransaction = createCapitalizedIncomeAmortizationTransaction(loan, transactionDate,
-        businessEventNotifierService
+                false);
-                .notifyPostBusinessEvent(new LoanCapitalizedIncomeAmortizationTransactionCreatedBusinessEvent(amortizationTransaction));
+        amortizationTransaction.ifPresent(loanTransaction -> businessEventNotifierService
+                .notifyPostBusinessEvent(new LoanCapitalizedIncomeAmortizationTransactionCreatedBusinessEvent(loanTransaction)));
     }
 
     @Override
@@ -67,13 +70,16 @@ public class LoanCapitalizedIncomeAmortizationProcessingServiceImpl implements L
             transactionDate = DateUtils.getBusinessLocalDate();
         }
 
-        final LoanTransaction amortizationTransaction = createCapitalizedIncomeAmortizationTransaction(loan, transactionDate, true);
+        final Optional<LoanTransaction> amortizationTransaction = createCapitalizedIncomeAmortizationTransaction(loan, transactionDate,
-        journalEntryPoster.postJournalEntries(loan, existingTransactionIds, existingReversedTransactionIds);
+                true);
-        businessEventNotifierService
+        if (amortizationTransaction.isPresent()) {
-                .notifyPostBusinessEvent(new LoanCapitalizedIncomeAmortizationTransactionCreatedBusinessEvent(amortizationTransaction));
+            journalEntryPoster.postJournalEntries(loan, existingTransactionIds, existingReversedTransactionIds);
+            businessEventNotifierService.notifyPostBusinessEvent(
+                    new LoanCapitalizedIncomeAmortizationTransactionCreatedBusinessEvent(amortizationTransaction.get()));
+        }
     }
 
-    private LoanTransaction createCapitalizedIncomeAmortizationTransaction(final Loan loan, final LocalDate transactionDate,
+    private Optional<LoanTransaction> createCapitalizedIncomeAmortizationTransaction(final Loan loan, final LocalDate transactionDate,
             final boolean isChargeOff) {
         ExternalId externalId = ExternalId.empty();
         BigDecimal totalUnrecognizedAmount = BigDecimal.ZERO;
@@ -92,13 +98,17 @@ public class LoanCapitalizedIncomeAmortizationProcessingServiceImpl implements L
             balance.setUnrecognizedAmount(BigDecimal.ZERO);
         }
 
+        if (MathUtil.isLessThanOrEqualZero(totalUnrecognizedAmount)) {
+            return Optional.empty();
+        }
+
         final LoanTransaction amortizationTransaction = LoanTransaction.capitalizedIncomeAmortization(loan, loan.getOffice(),
                 transactionDate, totalUnrecognizedAmount, externalId);
 
         loan.addLoanTransaction(amortizationTransaction);
         loanTransactionRepository.saveAndFlush(amortizationTransaction);
 
-        return amortizationTransaction;
+        return Optional.of(amortizationTransaction);
     }
 
     @Override

fineract-provider/src/main/java/org/apache/fineract/portfolio/loanaccount/service/LoanReadPlatformServiceImpl.java

@@ -98,6 +98,7 @@ import org.apache.fineract.portfolio.loanaccount.data.LoanApprovalData;
 import org.apache.fineract.portfolio.loanaccount.data.LoanChargePaidByData;
 import org.apache.fineract.portfolio.loanaccount.data.LoanInterestRecalculationData;
 import org.apache.fineract.portfolio.loanaccount.data.LoanRepaymentScheduleInstallmentData;
+import org.apache.fineract.portfolio.loanaccount.data.LoanSchedulePeriodDataWrapper;
 import org.apache.fineract.portfolio.loanaccount.data.LoanStatusEnumData;
 import org.apache.fineract.portfolio.loanaccount.data.LoanSummaryData;
 import org.apache.fineract.portfolio.loanaccount.data.LoanTransactionData;
@@ -118,6 +119,7 @@ import org.apache.fineract.portfolio.loanaccount.domain.LoanRepositoryWrapper;
 import org.apache.fineract.portfolio.loanaccount.domain.LoanStatus;
 import org.apache.fineract.portfolio.loanaccount.domain.LoanSubStatus;
 import org.apache.fineract.portfolio.loanaccount.domain.LoanTransaction;
+import org.apache.fineract.portfolio.loanaccount.domain.LoanTransactionRepaymentPeriodData;
 import org.apache.fineract.portfolio.loanaccount.domain.LoanTransactionRepository;
 import org.apache.fineract.portfolio.loanaccount.domain.LoanTransactionType;
 import org.apache.fineract.portfolio.loanaccount.exception.LoanNotFoundException;
@@ -249,8 +251,10 @@ public class LoanReadPlatformServiceImpl implements LoanReadPlatformService, Loa
                 accountData.getFeeChargesAtDisbursementCharged());
 
         final Collection<DisbursementData> disbursementData = retrieveLoanDisbursementDetails(accountData.getId());
+        List<LoanTransactionRepaymentPeriodData> capitalizedIncomeData = loanCapitalizedIncomeBalanceRepository
+                .findRepaymentPeriodDataByLoanId(accountData.getId());
         final LoanScheduleData repaymentSchedule = retrieveRepaymentSchedule(accountData.getId(), repaymentScheduleRelatedData,
-                disbursementData, accountData.isInterestRecalculationEnabled(),
+                disbursementData, capitalizedIncomeData, accountData.isInterestRecalculationEnabled(),
                 LoanScheduleType.fromEnumOptionData(accountData.getLoanScheduleType()));
         accountData.setRepaymentSchedule(repaymentSchedule);
         return accountData;
@@ -259,13 +263,15 @@ public class LoanReadPlatformServiceImpl implements LoanReadPlatformService, Loa
     @Override
     public LoanScheduleData retrieveRepaymentSchedule(final Long loanId,
             final RepaymentScheduleRelatedLoanData repaymentScheduleRelatedLoanData, Collection<DisbursementData> disbursementData,
-            boolean isInterestRecalculationEnabled, LoanScheduleType loanScheduleType) {
+            Collection<LoanTransactionRepaymentPeriodData> capitalizedIncomeData, boolean isInterestRecalculationEnabled,
+            LoanScheduleType loanScheduleType) {
 
         try {
             this.context.authenticatedUser();
 
             final LoanScheduleResultSetExtractor fullResultsetExtractor = new LoanScheduleResultSetExtractor(
-                    repaymentScheduleRelatedLoanData, disbursementData, isInterestRecalculationEnabled, loanScheduleType);
+                    repaymentScheduleRelatedLoanData, disbursementData, capitalizedIncomeData, isInterestRecalculationEnabled,
+                    loanScheduleType);
             final String sql = "select " + fullResultsetExtractor.schema() + " where ls.loan_id = ? order by ls.loan_id, ls.installment";
 
             return this.jdbcTemplate.query(sql, fullResultsetExtractor, loanId); // NOSONAR
@@ -749,7 +755,7 @@ public class LoanReadPlatformServiceImpl implements LoanReadPlatformService, Loa
                     + " l.expected_disbursedon_date as expectedDisbursementDate, l.disbursedon_date as actualDisbursementDate, dbu.username as disbursedByUsername, dbu.firstname as disbursedByFirstname, dbu.lastname as disbursedByLastname,"
                     + " l.closedon_date as closedOnDate, cbu.username as closedByUsername, cbu.firstname as closedByFirstname, cbu.lastname as closedByLastname, l.writtenoffon_date as writtenOffOnDate, "
                     + " l.expected_firstrepaymenton_date as expectedFirstRepaymentOnDate, l.interest_calculated_from_date as interestChargedFromDate, l.maturedon_date as actualMaturityDate, l.expected_maturedon_date as expectedMaturityDate, "
-                    + " l.principal_amount_proposed as proposedPrincipal, l.principal_amount as principal, l.approved_principal as approvedPrincipal, l.net_disbursal_amount as netDisbursalAmount, l.arrearstolerance_amount as inArrearsTolerance, l.number_of_repayments as numberOfRepayments, l.repay_every as repaymentEvery,"
+                    + " l.principal_amount_proposed as proposedPrincipal, l.principal_amount as principal, l.total_principal_derived as totalPrincipal, l.approved_principal as approvedPrincipal, l.net_disbursal_amount as netDisbursalAmount, l.arrearstolerance_amount as inArrearsTolerance, l.number_of_repayments as numberOfRepayments, l.repay_every as repaymentEvery,"
                     + " l.grace_on_principal_periods as graceOnPrincipalPayment, l.recurring_moratorium_principal_periods as recurringMoratoriumOnPrincipalPeriods, l.grace_on_interest_periods as graceOnInterestPayment, l.grace_interest_free_periods as graceOnInterestCharged,l.grace_on_arrears_ageing as graceOnArrearsAgeing,"
                     + " l.nominal_interest_rate_per_period as interestRatePerPeriod, l.annual_nominal_interest_rate as annualInterestRate, "
                     + " l.repayment_period_frequency_enum as repaymentFrequencyType, l.interest_period_frequency_enum as interestRateFrequencyType, "
@@ -764,7 +770,7 @@ public class LoanReadPlatformServiceImpl implements LoanReadPlatformService, Loa
                     + sqlGenerator.escape("name")
                     + " as currencyName, rc.display_symbol as currencyDisplaySymbol, rc.internationalized_name_code as currencyNameCode, "
                     + " l.loan_officer_id as loanOfficerId, s.display_name as loanOfficerName, "
-                    + " l.principal_disbursed_derived as principalDisbursed, l.principal_repaid_derived as principalPaid,"
+                    + " l.principal_disbursed_derived as principalDisbursed, l.capitalized_income_derived as totalCapitalizedIncome, l.capitalized_income_adjustment_derived as totalCapitalizedIncomeAdjustment, l.principal_repaid_derived as principalPaid,"
                     + " l.principal_adjustments_derived as principalAdjustments, l.principal_writtenoff_derived as principalWrittenOff,"
                     + " l.fee_adjustments_derived as feeAdjustments, l.penalty_adjustments_derived as penaltyAdjustments,"
                     + " l.principal_outstanding_derived as principalOutstanding, l.interest_charged_derived as interestCharged,"
@@ -1023,6 +1029,10 @@ public class LoanReadPlatformServiceImpl implements LoanReadPlatformService, Loa
 
                 // loan summary
                 final BigDecimal principalDisbursed = JdbcSupport.getBigDecimalDefaultToZeroIfNull(rs, "principalDisbursed");
+                final BigDecimal totalPrincipal = JdbcSupport.getBigDecimalDefaultToZeroIfNull(rs, "totalPrincipal");
+                final BigDecimal totalCapitalizedIncome = JdbcSupport.getBigDecimalDefaultToZeroIfNull(rs, "totalCapitalizedIncome");
+                final BigDecimal totalCapitalizedIncomeAdjustment = JdbcSupport.getBigDecimalDefaultToZeroIfNull(rs,
+                        "totalCapitalizedIncomeAdjustment");
                 final BigDecimal principalAdjustments = JdbcSupport.getBigDecimalDefaultToZeroIfNull(rs, "principalAdjustments");
                 final BigDecimal principalPaid = JdbcSupport.getBigDecimalDefaultToZeroIfNull(rs, "principalPaid");
                 final BigDecimal principalWrittenOff = JdbcSupport.getBigDecimalDefaultToZeroIfNull(rs, "principalWrittenOff");
@@ -1066,12 +1076,14 @@ public class LoanReadPlatformServiceImpl implements LoanReadPlatformService, Loa
                 inArrears = (overdueSinceDate != null);
 
                 loanSummary = LoanSummaryData.builder().currency(currencyData).principalDisbursed(principalDisbursed)
-                        .principalAdjustments(principalAdjustments).principalPaid(principalPaid).principalWrittenOff(principalWrittenOff)
+                        .totalPrincipal(totalPrincipal).totalCapitalizedIncome(totalCapitalizedIncome)
-                        .principalOutstanding(principalOutstanding).principalOverdue(principalOverdue).interestCharged(interestCharged)
+                        .totalCapitalizedIncomeAdjustment(totalCapitalizedIncomeAdjustment).principalAdjustments(principalAdjustments)
-                        .interestPaid(interestPaid).interestWaived(interestWaived).interestWrittenOff(interestWrittenOff)
+                        .principalPaid(principalPaid).principalWrittenOff(principalWrittenOff).principalOutstanding(principalOutstanding)
-                        .interestOutstanding(interestOutstanding).interestOverdue(interestOverdue).feeChargesCharged(feeChargesCharged)
+                        .principalOverdue(principalOverdue).interestCharged(interestCharged).interestPaid(interestPaid)
-                        .feeAdjustments(feeAdjustments).feeChargesDueAtDisbursementCharged(feeChargesDueAtDisbursementCharged)
+                        .interestWaived(interestWaived).interestWrittenOff(interestWrittenOff).interestOutstanding(interestOutstanding)
-                        .feeChargesPaid(feeChargesPaid).feeChargesWaived(feeChargesWaived).feeChargesWrittenOff(feeChargesWrittenOff)
+                        .interestOverdue(interestOverdue).feeChargesCharged(feeChargesCharged).feeAdjustments(feeAdjustments)
+                        .feeChargesDueAtDisbursementCharged(feeChargesDueAtDisbursementCharged).feeChargesPaid(feeChargesPaid)
+                        .feeChargesWaived(feeChargesWaived).feeChargesWrittenOff(feeChargesWrittenOff)
                         .feeChargesOutstanding(feeChargesOutstanding).feeChargesOverdue(feeChargesOverdue)
                         .penaltyChargesCharged(penaltyChargesCharged).penaltyAdjustments(penaltyAdjustments)
                         .penaltyChargesPaid(penaltyChargesPaid).penaltyChargesWaived(penaltyChargesWaived)
@@ -1271,15 +1283,18 @@ public class LoanReadPlatformServiceImpl implements LoanReadPlatformService, Loa
         private final DisbursementData disbursement;
         private final BigDecimal totalFeeChargesDueAtDisbursement;
         private final Collection<DisbursementData> disbursementData;
+        private final Collection<LoanTransactionRepaymentPeriodData> capitalizedIncomeData;
         private final LoanScheduleType loanScheduleType;
         private LocalDate lastDueDate;
         private BigDecimal outstandingLoanPrincipalBalance;
         private boolean excludePastUnDisbursed;
 
         LoanScheduleResultSetExtractor(final RepaymentScheduleRelatedLoanData repaymentScheduleRelatedLoanData,
-                Collection<DisbursementData> disbursementData, boolean isInterestRecalculationEnabled, LoanScheduleType loanScheduleType) {
+                Collection<DisbursementData> disbursementData, Collection<LoanTransactionRepaymentPeriodData> capitalizedIncomeData,
+                boolean isInterestRecalculationEnabled, LoanScheduleType loanScheduleType) {
             this.currency = repaymentScheduleRelatedLoanData.getCurrency();
             this.disbursement = repaymentScheduleRelatedLoanData.disbursementData();
+            this.capitalizedIncomeData = capitalizedIncomeData;
             this.totalFeeChargesDueAtDisbursement = repaymentScheduleRelatedLoanData.getTotalFeeChargesAtDisbursement();
             this.lastDueDate = this.disbursement.disbursementDate();
             this.outstandingLoanPrincipalBalance = this.disbursement.getPrincipal();
@@ -1359,10 +1374,15 @@ public class LoanReadPlatformServiceImpl implements LoanReadPlatformService, Loa
                 final LocalDate dueDate = JdbcSupport.getLocalDate(rs, "dueDate");
                 final LocalDate obligationsMetOnDate = JdbcSupport.getLocalDate(rs, "obligationsMetOnDate");
                 final boolean complete = rs.getBoolean("complete");
-                BigDecimal disbursedAmount = BigDecimal.ZERO;
 
-                disbursedAmount = processDisbursementData(loanScheduleType, disbursementData, fromDate, dueDate, disbursementPeriodIds,
+                List<LoanSchedulePeriodDataWrapper> combinedDataList = new ArrayList<>();
-                        disbursementChargeAmount, waivedChargeAmount, periods);
+                combinedDataList.addAll(
+                        collectEligibleDisbursementData(loanScheduleType, disbursementData, fromDate, dueDate, disbursementPeriodIds));
+                combinedDataList.addAll(collectEligibleCapitalizedIncomeData(fromDate, dueDate, disbursementPeriodIds));
+                combinedDataList.sort(this::sortPeriodDataHolders);
+                fillLoanSchedulePeriodData(periods, combinedDataList, disbursementChargeAmount, waivedChargeAmount);
+
+                BigDecimal disbursedAmount = calculateDisbursedAmount(combinedDataList);
 
                 // Add the Charge back or Credits to the initial amount to avoid negative balance
                 final BigDecimal principalCredits = JdbcSupport.getBigDecimalDefaultToZeroIfNull(rs, "principalCredits");
@@ -1473,26 +1493,82 @@ public class LoanReadPlatformServiceImpl implements LoanReadPlatformService, Loa
                     totalPaidLate.getAmount(), totalOutstanding.getAmount(), totalCredits.getAmount());
         }
 
-        private BigDecimal processDisbursementData(LoanScheduleType loanScheduleType, Collection<DisbursementData> disbursementData,
+        private List<LoanSchedulePeriodDataWrapper> collectEligibleDisbursementData(LoanScheduleType loanScheduleType,
-                LocalDate fromDate, LocalDate dueDate, Set<Long> disbursementPeriodIds, BigDecimal disbursementChargeAmount,
+                Collection<DisbursementData> disbursementData, LocalDate fromDate, LocalDate dueDate, Set<Long> disbursementPeriodIds) {
-                BigDecimal waivedChargeAmount, List<LoanSchedulePeriodData> periods) {
+            List<LoanSchedulePeriodDataWrapper> disbursementDataList = new ArrayList<>();
-            BigDecimal disbursedAmount = BigDecimal.ZERO;
+            // Collect eligible disbursement data
             for (final DisbursementData data : disbursementData) {
                 boolean isDueForDisbursement = data.isDueForDisbursement(loanScheduleType, fromDate, dueDate);
-                if (((fromDate.equals(this.disbursement.disbursementDate()) && data.disbursementDate().equals(fromDate))
+                boolean isEligible = ((fromDate.equals(this.disbursement.disbursementDate()) && data.disbursementDate().equals(fromDate))
                         || (fromDate.equals(dueDate) && data.disbursementDate().equals(fromDate))
                         || canAddDisbursementData(data, isDueForDisbursement, excludePastUnDisbursed))
-                        && !disbursementPeriodIds.contains(data.getId())) {
+                        && !disbursementPeriodIds.contains(data.getId());
-                    disbursedAmount = disbursedAmount.add(data.getPrincipal());
+
-                    LoanSchedulePeriodData periodData = createLoanSchedulePeriodData(data, disbursementChargeAmount, waivedChargeAmount);
+                if (isEligible) {
-                    periods.add(periodData);
+                    disbursementDataList.add(new LoanSchedulePeriodDataWrapper(data, data.disbursementDate(), true));
-                    this.outstandingLoanPrincipalBalance = this.outstandingLoanPrincipalBalance.add(periodData.getPrincipalDisbursed());
                     disbursementPeriodIds.add(data.getId());
                 }
             }
+            return disbursementDataList;
+        }
+
+        private List<LoanSchedulePeriodDataWrapper> collectEligibleCapitalizedIncomeData(LocalDate fromDate, LocalDate dueDate,
+                Set<Long> disbursementPeriodIds) {
+            List<LoanSchedulePeriodDataWrapper> capitalizedIncomeDataList = new ArrayList<>();
+            // Collect eligible capitalized income data
+            for (LoanTransactionRepaymentPeriodData data : capitalizedIncomeData) {
+                boolean isEligible = canAddCapitalizedIncomeData(data, fromDate, dueDate)
+                        && !disbursementPeriodIds.contains(data.getTransactionId());
+
+                if (isEligible) {
+                    capitalizedIncomeDataList.add(new LoanSchedulePeriodDataWrapper(data, data.getDate(), false));
+                    disbursementPeriodIds.add(data.getTransactionId());
+                }
+            }
+            return capitalizedIncomeDataList;
+        }
+
+        private void fillLoanSchedulePeriodData(List<LoanSchedulePeriodData> periods, List<LoanSchedulePeriodDataWrapper> combinedDataList,
+                BigDecimal disbursementChargeAmount, BigDecimal waivedChargeAmount) {
+            // Process all collected data in chronological order
+            for (LoanSchedulePeriodDataWrapper dataItem : combinedDataList) {
+                LoanSchedulePeriodData periodData;
+                if (dataItem.isDisbursement()) {
+                    // Process disbursement data
+                    DisbursementData data = (DisbursementData) dataItem.getData();
+                    periodData = createLoanSchedulePeriodData(data, disbursementChargeAmount, waivedChargeAmount);
+                } else {
+                    // Process capitalized income data
+                    LoanTransactionRepaymentPeriodData data = (LoanTransactionRepaymentPeriodData) dataItem.getData();
+                    periodData = createLoanSchedulePeriodData(data);
+                }
+
+                // Common processing for both data types
+                periods.add(periodData);
+                this.outstandingLoanPrincipalBalance = this.outstandingLoanPrincipalBalance.add(periodData.getPrincipalDisbursed());
+            }
+        }
+
+        private BigDecimal calculateDisbursedAmount(List<LoanSchedulePeriodDataWrapper> combinedDataList) {
+            BigDecimal disbursedAmount = BigDecimal.ZERO;
+            for (LoanSchedulePeriodDataWrapper dataItem : combinedDataList) {
+                if (dataItem.isDisbursement()) {
+                    DisbursementData data = (DisbursementData) dataItem.getData();
+                    disbursedAmount = disbursedAmount.add(data.getPrincipal());
+                }
+            }
             return disbursedAmount;
         }
 
+        private int sortPeriodDataHolders(LoanSchedulePeriodDataWrapper item1, LoanSchedulePeriodDataWrapper item2) {
+            int dateComparison = item1.getDate().compareTo(item2.getDate());
+            if (dateComparison == 0 && item1.isDisbursement() != item2.isDisbursement()) {
+                // If dates are equal, prioritize disbursement data
+                return item1.isDisbursement() ? -1 : 1;
+            }
+            return dateComparison;
+        }
+
         private LoanSchedulePeriodData createLoanSchedulePeriodData(final DisbursementData data, BigDecimal disbursementChargeAmount,
                 BigDecimal waivedChargeAmount) {
             BigDecimal chargeAmount = data.getChargeAmount() == null ? disbursementChargeAmount
@@ -1501,11 +1577,20 @@ public class LoanReadPlatformServiceImpl implements LoanReadPlatformService, Loa
                     data.isDisbursed());
         }
 
+        private LoanSchedulePeriodData createLoanSchedulePeriodData(final LoanTransactionRepaymentPeriodData data) {
+            BigDecimal feeCharges = Objects.isNull(data.getFeeChargesPortion()) ? BigDecimal.ZERO : data.getFeeChargesPortion();
+            return LoanSchedulePeriodData.disbursementOnlyPeriod(data.getDate(), data.getAmount(), feeCharges, !data.isReversed());
+        }
+
         private boolean canAddDisbursementData(DisbursementData data, boolean isDueForDisbursement, boolean excludePastUnDisbursed) {
             return (!excludePastUnDisbursed || data.isDisbursed() || !DateUtils.isBeforeBusinessDate(data.disbursementDate()))
                     && isDueForDisbursement;
         }
 
+        private boolean canAddCapitalizedIncomeData(LoanTransactionRepaymentPeriodData data, LocalDate fromDate, LocalDate dueDate) {
+            return !data.isReversed() && DateUtils.isDateInRangeFromInclusiveToExclusive(fromDate, dueDate, data.getDate());
+        }
+
     }
 
     private static final class LoanTransactionsMapper implements RowMapper<LoanTransactionData> {
@@ -2168,7 +2253,7 @@ public class LoanReadPlatformServiceImpl implements LoanReadPlatformService, Loa
         final LoanTransactionEnumData transactionType = LoanEnumerations.transactionType(LoanTransactionType.REPAYMENT);
         final Collection<PaymentTypeData> paymentTypeOptions = this.paymentTypeReadPlatformService.retrieveAllPaymentTypes();
         final BigDecimal outstandingLoanBalance = loanRepaymentScheduleInstallment.getPrincipalOutstanding(currency).getAmount();
-        final Boolean isReversed = false;
+        final Boolean isManuallyReversed = false;
 
         final Money outStandingAmount = loanRepaymentScheduleInstallment.getTotalOutstanding(currency);
 
@@ -2178,7 +2263,8 @@ public class LoanReadPlatformServiceImpl implements LoanReadPlatformService, Loa
                 loanRepaymentScheduleInstallment.getInterestOutstanding(currency).getAmount(),
                 loanRepaymentScheduleInstallment.getFeeChargesOutstanding(currency).getAmount(),
                 loanRepaymentScheduleInstallment.getPenaltyChargesOutstanding(currency).getAmount(), null, unrecognizedIncomePortion,
-                paymentTypeOptions, ExternalId.empty(), null, null, outstandingLoanBalance, isReversed, loanId, loan.getExternalId());
+                paymentTypeOptions, ExternalId.empty(), null, null, outstandingLoanBalance, isManuallyReversed, loanId,
+                loan.getExternalId());
     }
 
     private static final class CurrencyMapper implements RowMapper<CurrencyData> {

fineract-provider/src/main/java/org/apache/fineract/portfolio/loanaccount/service/adjustment/LoanAdjustmentServiceImpl.java

@@ -64,6 +64,7 @@ import org.apache.fineract.portfolio.loanaccount.service.LoanBalanceService;
 import org.apache.fineract.portfolio.loanaccount.service.LoanDownPaymentHandlerService;
 import org.apache.fineract.portfolio.loanaccount.service.LoanJournalEntryPoster;
 import org.apache.fineract.portfolio.loanaccount.service.LoanUtilService;
+import org.apache.fineract.portfolio.loanaccount.service.ReprocessLoanTransactionsService;
 import org.apache.fineract.portfolio.note.domain.Note;
 import org.apache.fineract.portfolio.note.domain.NoteRepository;
 import org.apache.fineract.portfolio.paymentdetail.domain.PaymentDetail;
@@ -93,6 +94,7 @@ public class LoanAdjustmentServiceImpl implements LoanAdjustmentService {
     private final LoanChargeValidator loanChargeValidator;
     private final LoanJournalEntryPoster journalEntryPoster;
     private final LoanBalanceService loanBalanceService;
+    private final ReprocessLoanTransactionsService reprocessLoanTransactionsService;
 
     @Override
     public CommandProcessingResult adjustLoanTransaction(Loan loan, LoanTransaction transactionToAdjust, LoanAdjustmentParameter parameter,
@@ -245,8 +247,9 @@ public class LoanAdjustmentServiceImpl implements LoanAdjustmentService {
                 transactionForAdjustment.getTransactionDate());
 
         if (!transactionForAdjustment.isAccrualRelated() && transactionForAdjustment.isNotRepaymentLikeType()
-                && transactionForAdjustment.isNotWaiver() && transactionForAdjustment.isNotCreditBalanceRefund()) {
+                && transactionForAdjustment.isNotWaiver() && transactionForAdjustment.isNotCreditBalanceRefund()
-            final String errorMessage = "Only (non-reversed) transactions of type repayment, waiver, accrual or credit balance refund can be adjusted.";
+                && !transactionForAdjustment.isCapitalizedIncome()) {
+            final String errorMessage = "Only (non-reversed) transactions of type repayment, waiver, capitalized income, accrual or credit balance refund can be adjusted.";
             throw new InvalidLoanTransactionTypeException("transaction",
                     "adjustment.is.only.allowed.to.repayment.or.waiver.or.creditbalancerefund.transactions", errorMessage);
         }
@@ -285,6 +288,10 @@ public class LoanAdjustmentServiceImpl implements LoanAdjustmentService {
             loanDownPaymentHandlerService.handleRepaymentOrRecoveryOrWaiverTransaction(loan, newTransactionDetail, transactionForAdjustment,
                     scheduleGeneratorDTO);
         }
+
+        if (transactionForAdjustment.getTypeOf().equals(LoanTransactionType.CAPITALIZED_INCOME)) {
+            reprocessLoanTransactionsService.reprocessTransactions(loan);
+        }
     }
 
     private Loan saveAndFlushLoanWithDataIntegrityViolationChecks(final Loan loan) {

fineract-provider/src/main/java/org/apache/fineract/portfolio/note/service/NoteWritePlatformServiceJpaRepositoryImpl.java

@@ -204,9 +204,13 @@ public class NoteWritePlatformServiceJpaRepositoryImpl implements NoteWritePlatf
     }
 
     @Override
-    public void createLoanNote(final Long loanId, final String note) {
+    public void createLoanTransactionNote(final Long loanTransactionId, final String note) {
-        final Loan loan = this.loanRepository.findOneWithNotFoundDetection(loanId);
+        final LoanTransaction loanTransaction = this.loanTransactionRepository.findById(loanTransactionId)
-        final Note newNote = Note.loanNote(loan, note);
+                .orElseThrow(() -> new LoanTransactionNotFoundException(loanTransactionId));
+
+        final Loan loan = loanTransaction.getLoan();
+
+        final Note newNote = Note.loanTransactionNote(loan, loanTransaction, note);
 
         this.noteRepository.save(newNote);
     }

fineract-provider/src/main/resources/db/changelog/tenant/changelog-tenant.xml

@@ -196,4 +196,5 @@
     <include file="parts/0175_add_fk_acc_product_mapping.xml" relativeToChangelogFile="true" />
     <include file="parts/0176_add_capitalized_income_amortization_transaction.xml" relativeToChangelogFile="true" />
     <include file="parts/0177_acc_journal_entry_index.xml" relativeToChangelogFile="true" />
+    <include file="parts/0178_add_principal_from_capitalized_income_to_loan_summary.xml" relativeToChangelogFile="true" />
 </databaseChangeLog>

fineract-provider/src/main/resources/db/changelog/tenant/parts/0178_add_principal_from_capitalized_income_to_loan_summary.xml

@@ -0,0 +1,38 @@
+<?xml version="1.0" encoding="UTF-8"?>
+<!--
+
+    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.
+
+-->
+<databaseChangeLog xmlns="http://www.liquibase.org/xml/ns/dbchangelog"
+                   xmlns:xsi="http://www.w3.org/2001/XMLSchema-instance"
+                   xsi:schemaLocation="http://www.liquibase.org/xml/ns/dbchangelog http://www.liquibase.org/xml/ns/dbchangelog/dbchangelog-4.3.xsd">
+    <changeSet author="fineract" id="1">
+        <addColumn tableName="m_loan">
+            <column defaultValueNumeric="0.000000" name="capitalized_income_derived" type="DECIMAL(19, 6)">
+                <constraints nullable="false"/>
+            </column>
+            <column defaultValueNumeric="0.000000" name="capitalized_income_adjustment_derived" type="DECIMAL(19, 6)">
+                <constraints nullable="false"/>
+            </column>
+            <column defaultValueNumeric="0.000000" name="total_principal_derived" type="DECIMAL(19, 6)">
+                <constraints nullable="false"/>
+            </column>
+        </addColumn>
+    </changeSet>
+</databaseChangeLog>

integration-tests/src/test/java/org/apache/fineract/integrationtests/LoanCapitalizedIncomeTest.java

@@ -78,7 +78,7 @@ public class LoanCapitalizedIncomeTest extends BaseLoanIntegrationTest {
                     transaction(100.0, "Disbursement", "01 January 2024"), //
                     transaction(50.0, "Capitalized Income", "01 January 2024"), //
                     transaction(0.55, "Capitalized Income Amortization", "01 January 2024"), //
-                    transaction(0.02, "Accrual", "02 January 2024"), //
+                    transaction(0.03, "Accrual", "02 January 2024"), //
                     transaction(0.55, "Capitalized Income Amortization", "02 January 2024") //
             );
 
@@ -89,8 +89,8 @@ public class LoanCapitalizedIncomeTest extends BaseLoanIntegrationTest {
                     journalEntry(50, deferredIncomeLiabilityAccount, "CREDIT"), //
                     journalEntry(0.55, deferredIncomeLiabilityAccount, "DEBIT"), //
                     journalEntry(0.55, feeIncomeAccount, "CREDIT"), //
-                    journalEntry(0.02, interestReceivableAccount, "DEBIT"), //
+                    journalEntry(0.03, interestReceivableAccount, "DEBIT"), //
-                    journalEntry(0.02, interestIncomeAccount, "CREDIT"), //
+                    journalEntry(0.03, interestIncomeAccount, "CREDIT"), //
                     journalEntry(0.55, deferredIncomeLiabilityAccount, "DEBIT"), //
                     journalEntry(0.55, feeIncomeAccount, "CREDIT") //
             );

integration-tests/src/test/java/org/apache/fineract/integrationtests/LoanSummaryTest.java

@@ -19,7 +19,9 @@
 package org.apache.fineract.integrationtests;
 
 import java.math.BigDecimal;
+import java.math.RoundingMode;
 import java.util.List;
+import org.apache.fineract.client.models.GetLoansLoanIdRepaymentPeriod;
 import org.apache.fineract.client.models.GetLoansLoanIdResponse;
 import org.apache.fineract.client.models.PostLoanProductsResponse;
 import org.apache.fineract.client.models.PostLoansResponse;
@@ -248,4 +250,37 @@ public class LoanSummaryTest extends BaseLoanIntegrationTest {
         });
     }
 
+    @Test
+    public void testCapitalizedIncomeExistsInRepaymentScheduleAndModifiesPrincipal() {
+        runAt("01 March 2023", () -> {
+            final PostLoanProductsResponse loanProductsResponse = loanProductHelper
+                    .createLoanProduct(create4IProgressiveWithCapitalizedIncome());
+            PostLoansResponse postLoansResponse = loanTransactionHelper.applyLoan(applyLP2ProgressiveLoanRequest(clientId,
+                    loanProductsResponse.getResourceId(), "01 March 2023", 10000.00, 12.00, 4, null));
+            loanId = postLoansResponse.getLoanId();
+            loanTransactionHelper.approveLoan(loanId, approveLoanRequest(10000.00, "01 March 2023"));
+            disburseLoan(loanId, BigDecimal.valueOf(1000.00), "01 March 2023");
+        });
+        runAt("02 March 2023", () -> {
+            loanTransactionHelper.addCapitalizedIncome(loanId, "02 March 2023", 100.00);
+        });
+
+        BigDecimal thousand = BigDecimal.valueOf(1000.0);
+        BigDecimal hundred = BigDecimal.valueOf(100.0);
+        BigDecimal thousandOneHundred = BigDecimal.valueOf(1100.0);
+
+        GetLoansLoanIdResponse loanDetails = loanTransactionHelper.getLoanDetails(loanId);
+
+        Assertions.assertEquals(thousand, loanDetails.getPrincipal().setScale(1, RoundingMode.HALF_UP));
+        Assertions.assertEquals(thousand, loanDetails.getSummary().getPrincipalDisbursed().setScale(1, RoundingMode.HALF_UP));
+        Assertions.assertEquals(hundred, loanDetails.getSummary().getTotalCapitalizedIncome().setScale(1, RoundingMode.HALF_UP));
+        Assertions.assertEquals(thousandOneHundred, loanDetails.getSummary().getTotalPrincipal().setScale(1, RoundingMode.HALF_UP));
+        Assertions.assertEquals(thousandOneHundred, loanDetails.getSummary().getPrincipalOutstanding().setScale(1, RoundingMode.HALF_UP));
+
+        List<GetLoansLoanIdRepaymentPeriod> periods = loanDetails.getRepaymentSchedule().getPeriods();
+        Assertions.assertEquals(6, periods.size());
+        Assertions.assertEquals(thousand, periods.get(0).getPrincipalLoanBalanceOutstanding().setScale(1, RoundingMode.HALF_UP));
+        Assertions.assertEquals(hundred, periods.get(1).getPrincipalLoanBalanceOutstanding().setScale(1, RoundingMode.HALF_UP));
+    }
+
 }