Multi-Purpose Cooperative Loan Management System Capstone Project Document


Keeping of information and data can be considered as a life-line of an organization. With the help of technology keeping of records has become easier in terms of gathering, monitoring, recording and storing information that may help or contribute for future use. It provides affordable, efficient and reliable way for keeping records than manual process that engage in using large volume of papers and files.

A bookkeeper plays an important role in managing a loan system. However, such manual system does not frequently relate predictions, results and performance. The bookkeeper might lose or misplace the records consequential to losing all information belongs to loan management. A computerized loan management is highly advisable particularly when it can provide less effort and more efficient and timely results. Multi-Purpose Cooperative (MVMPC) Online Loan Management can supply an application form to create their own profile in order for the borrowers and members to be able to monitor their accounts; enables the bookkeeper to view the payments and allows to view the borrowers and members who forfeit to pay the remaining balance.

Background Of The Study                                                

A loan is a quantity of money agreed with an individual or organization with an agreement that will be paid off over a given duration with interest, which serves as payment for borrowing the money. The manual process of gaining and granting loans are inconvenient and a waste of time for the lender as well as the borrower. A lender plays a big role in the entire process that requires efficient and effective means in controlling the loan processes. The objective of developing this system in achieving Efficient and effective loan process using technology in order to give the organization a competitive advantage suggests to have a computerized Loan Management System. Therefore, there is a great need to computerize the procedure in processing the loan as much as possible.

An Online Loan Management System enables the processing of loan from submission to final confirmation more efficient and timely outcome. Using this system, the administrator can easily find borrower details without using large

volume of papers and reducing the workload. It is very helpful for the organization who takes in charge of loan management; the system provides a facility to generate reports easily at a click of a mouse. It also produces an understandable form for borrower’s transaction.

The proponents aim to reduce the workload of the bookkeeper by eliminating the use of manual filing, calculation and keeping all the records.

Objectives of the Study

The main objective of this study is to provide Vendors Multi-purpose Cooperative (MVMPC) a system for their loan transactions.

  1. This study aims to design and develop a Loan Management System with SMS notification for Vendors Multi-Purpose Cooperative (MVMPC) that will:
  2. Allow the management to view borrower’s accounts, rate of loan and loan types;
  3. Calculate EMI (Equated Monthly Instalment)details;
  4. Automatically send SMS notification for the loan status and payment of the borrower;
  5. Evaluate the system using ISO 9126 standard.

Conceptual Framework

Conceptual Framework

Conceptual Framework

A conceptual framework is an analytical tool with several variations and contexts.

The system:

  1. The borrower needs the approval of Bookkeeper for the application in getting loan. The bookkeeper is the one who will take in charge for the whole process of loan management.
  2. The assistant assists the bookkeeper in maintaining the borrower’s record and encodes daily reports.
  3. The Bookkeeper will notify the borrower through SMS.

Scope And Delimitation Of The Study

          This section enumerates the scope covered by the research and its delimitations.


The study focuses on the loans and the cash flow of each member by having the system that will monitor the daily, weekly, and monthly fees of the applicants. It will also determine which applicants will forfeit to pay their accounts to the loan that they applied with and it can give the individual inventory of the borrowers. System can send a SMS Notification every time the borrower pays their loan and it is a one-way process that the admin can send SMS to borrower about their Payment.


          Our system can’t provide the financial statement or the accounting process. The borrower can ask for printed receipt of their accounts but they are not allowed to edit it. It is not an online-based system. The admin or the assistant can send SMS to notify the borrower.

Significance of the Study

 This section will provide brief description on the various significances of the study and focused on various group of people:

The Company. This study will be beneficial to the company because it can provide easy access system, reliable and faster business transactions.


The Manager. This will benefit the manager in handling task simultaneously during the process with accurate output and can give comfort to the management.


The Bookkeeper. This study will be beneficial to the bookkeeper in a way that it will be no need to compile manual records and easy to track the borrower details.


The Assistant. This study will help the assistant to lessen their paper works by eliminating the need for manual compilation, to organize the record and monitor the borrower’s loan account.

The researcher. This study will help the researchers develop their system and provide more concepts regarding in making documentation.

The Future Researcher. This study will help future researchers who want to develop or conduct studies about loan management system. It will provide references for farther study that will benefit any researcher who wishes to enhance this existing system.

Definition of Terms

Loan. Conceptually, it is an arrangement in which a lender gives money or property to a borrower and the borrower agrees to return the property or repay the money, usually along with interest, at some future point(s) in time.

Operationally, it is a contract to borrow a money.


Lender. Conceptually, a private, public or institutional entity which makes funds available to others to borrow.

Operationally, it is the one who borrowed a capital to start a small business.

Bookkeeper. Conceptually, it is usually employed by a small to mid-size company to record its transactions such as sales, purchases, payroll, collection of accounts receivable, payment of bills.

Operationally, it has a skill of keeping a record of money transactions.

Transaction. Conceptually, it is an agreement between a buyer and a seller to exchange goods, services or financial instruments.

Operationally, it is the contract between the borrower and the company in applying loan.

Forfeit. Conceptually, a method of export trade financing, especially when dealing is capital goods or with high risk countries.

Operationally, it is where the borrower fails to pay his/her accounts.

Invoice. Conceptually, an itemized bill for goods sold or services provided, containing individual prices, the total charge, and the terms.

                             Operationally, it is a copy of the borrower payments duration.

EMI (Equated Monthly Instalment). Conceptually, it is a fixed payment amount made by a borrower to a lender at a specified date each calendar month. Equated monthly instalments are used to pay off both interest and principal each month, so that over a specified number of years, the loan is paid off in full.”

                   Operationally, it is a calculation of the borrower’s payments in daily, weekly, monthly and yearly.

Related Literature


Postbank of the Philippines Loan Management System.

According to Bhagwatsaran (2015). Postbank’s Loan Management System. Riding on the successful delivery of the loan Management System, Postbank has taken the next step in modernizing the experience for deposit processes. With 25 branches located nationwide and a long-distance legacy of bringing banking services closer to the homes of Filipino families in rural areas, Postbank has certainly made a mark in the lives of many., it is also their commitment to this level of trust, focus and efficiency that makes them a perfect complement to Postbank as proven with the delivery of the Loan Management System earlier this year which has led to the cementing of the partnership with the awarding of the Deposit Management System.

Ever First Loan Corporation Loan Management System

According to Cerquit Loans Developer (2013).Application of loans, managing receivables, financial assistance, collections, and creating reports. It aims to promote productivity, efficiency and convenience to not just collection officers, but to the managers, executives and business owners. Ever first has been providing short term pension loans to SSS pensioners in the Philippines, and in this short span of time, they have grown to thirty-five branches with more than one-hundred service-oriented employees. We are inspired by their mission to provide financial assistance to our fellow Filipinos with such integrity and dedication.



Black Cat Loan Management System.

According to Panther International (2012).LLC is an award-winning software and Services Company specializing in the transportation industry, Black Cat Loan Management System is an innovative, web-based solution designed and developed by Panther International, LLC to manage the entire cycle of loan. They use Loan Management System to centralized the full-featured system facilities, the loan origination, underwriting, servicing, compliance, collections, document management and closeout. As Mrs.Rublequoted my experienced and management skill with the help of this loan Management System will greatly benefit the clients we serve.

Mortech Loan Management System

According to Lincoln, Nebrasca (2011). Mortech launches all-inclusive front-end loan management system by using bull’s eye solution a mortgage technology software company which offers full automated underwriting system and credit and document management platforms to speed entire loan closing cycle. They use Mortech Loan Management System to allow their loan officer the freedom to price scenarios with instant result in an easy to use interface. Also it allows the freedom to customize down to a very detailed level thus allowing administrators a great deal of flexibility in terms what will price and the associated margins.


Related System

Related System

Related System

Figure 2 Related System



Related studies shows that both foreign and local studies focus on helping people to fulfil what will they need to improve their living, making efficient to use the loan system management and keep monitor the progress of the business. It also shows which features are available in the system, and features that are not present to the other systems in foreign and local.

Researching on the related systems stated above, the proponents noticed that both local and foreign study do not have SMS notification feature and the second local and first foreign do not provide invoice. In the system features above, the rest of the system features have in common because it relates to the system that we propose.

Therefore, the proponents took the features like loan management system that has SMS notification where the admin can send SMS automatically as soon as the borrowers pays their balances. The other features relate each other in terms of loan management, the studies above are also related to the system we propose that can make it more profitable and beneficial to its users.


This chapter contains methodology, phases, system development life cycle (SDLC) models, user acceptance survey, requirement specification, cost benefit analysis and models.

We use the Iterative model, iterative process starts with a simple implementation of a small set of the software requirements and iteratively enhances the evolving versions until the complete system is implemented and ready to be deployed.

An iterative life cycle model does not attempt to start with a full specification of requirements. Instead, development begins by specifying and implementing just part of the software, which is then reviewed in order to identify further requirements. This process is then repeated, producing a new version of the software at the end of each iteration of the model.

Iterative Model

Iterative Model

Planning Phase

In this phase, the proponents chose the project and determine their skills and responsibilities in the system. We conduct meeting to discuss about the system, distribute the works and doing research. Scheduling the activities until the project will be done. The proponents determine who will be using the system, it’s functionality to the user and we do teamwork for all the works.

Analysis Phase

In system analysis, the proponents conduct interview to the company and analyses the flow/process of the system and the requirements used to make the project possible. It includes the software and hardware specification, and also choosing the best programming language to be used that will affect the functionality and the interface of the system.

Design Phase

In design phase, the proponents make the system prototype and constructing the data flow diagram. We used Gantt chart for scheduling the activities needed to achieve the target goal. The system has a log in page where the admin should provide his/her username and password. Then it will direct to the dashboard where you will able to see the menus in which you can select your desired directories.

Development Phase

In this phase, the proponents start coding using CSS for template designing, JQuery for animation, JavaScript for commands and PHP as scripting language.

Testing Phase

In this phase, the proponents test and debug the system if all the functions are working.

Implementation Phase

The system is ready to be utilized. The tests have been done to ensure the quality of the system.

Maintenance Phase

In case of error or problem on the function of the system that we had done, they can contact or email us in order to fix the problem.

User’s Acceptance Survey

The development system will undergo user acceptance testing by the users of the system: management or the administration of the company which include Finance, Administrative, and Maintenance Department.

Operational Feasibility

Based on the proponents research the -MVMPC is currently using old method that is manual process in their loans and the office staff, which is the admin who encodes all the information that their clients have filled up in the form. The proposed system will help to reduce the paper work of the admin/office staff.

Program Environment

Front End

          In this study, the proponents used CSS for designing, HTML for required validation, JavaScript for the functions, Jquery for animation.

Back End

          In this study, the proponents used MySQL known as the world’s popular open source database with its proven performance, reliability and ease of use. And PHP a widely used open source general purpose scripting language that is especially suited for web development.


Technical Feasibility

Software Specifications (Minimum requirements) the proposed loan management system in  (MVMPC) needs the following software and hardware requirements in developing the system:

Hardware Specification (Minimum Requirements)

The proposed Loan Management System of Multi-purpose needs the following hardware requirements in developing system:

  1. Server Side
Computer Set Canon
Hard Drive 100GB
Printer Canon
Processor 1.9GHz (INTEL Quad Core)


  1. Client Side


Processor 2.4GHz (INTEL Quad Core)


Software Specification (Minimum Requirements)


  1. Server Side
Operating System Window 7 – Window 10
Web Server Apache Tomcat ver. 7.0
Front-End Tools JavaScript, HTML, Jquery, CSS
Back-End Tools MYSQL Server


  1. Client Server
Operating System Window 7 – Window 10
Web Browser Google Chrome

System Architecture

          Figure 3.0 displays the structural design of the system where in the Admin will be the one to manage the database and use the loan system. The loan system is connected to the database including the relationship for all the data inside the database.

The assistant is the one who can access the loan system and assist the admin in maintaining the records of the clients.

System Architecture

System Architecture

Cost Benefit Analysis


          Cost Benefit Analysis or CBA estimates and sums up the equivalent money value of the benefits & costs of the system in order to determine whether it is profitable or worth the investment.

Table 1.0: Development Cost

Duration              Monthly Cost                Total Amount

Programmer          5 months              Php7,000.00                  35,000.00

System Analysis   5 months              5, 000                             25,000.00

Researcher            5 months              4, 500                             22,500.00

Project Manager   5 months                      7, 500                     37,500.00

Electricity             5 months                       500                       2,500.00

Laptop                                                                                     20,000.00

Total                                                 Php142,500.00



          Table 1.0 shows the development cost of the researched system that consists of the personnel and the other expenses.

Table 2.0: Operational Cost

Operational Cost          Duration    Monthly Cost      Total Amount

Electricity                       12 months            700             Php 8,400.00

Maintenance fee             12 months         1,500.00        18,000.00

Internet Connection       12 months         1,900.00 (3Mbps)    22,800.00

Total                                                           Php49,200.00


          Table 2.0 shows the operational costs of the researched system. The operational cost includes the maintenance cost and expenditures in using the researched system.

Table 2.1: Total Development and Operational Cost

                                                                                      Total Amount

Total Developmental Cost                                              Php142,500.00

Total Operational Cost                                                            49,200.00

Total                     Php191,700.00



          Table 2.1 shows the development and the operational cost of the researched system.


Table 2.2: Benefits of the System

  Benefits of the System (Annually)                            Amount/Value

Efficiency of work/output of Employee                          Php70,000.00

Security of Data                                                                       15,500.00

Confidentiality of data                                                             20,000.00

Work Management of Employee                                       52,440.00

Total                     Php157,940.00


Table 2.2 shows the computed amount the company may benefit if the system will be implemented.

Cost Benefit Analysis

Cost Benefit Analysis

Cost Benefit Analysis

Entity Relationship Diagram

This figure shows the graphical representation of entities and their relationships to each other, typing used in computing in regards to the organization of data within databases or information systems. This depicts how one table is related to the other.




Data Flow Diagram

The figure shows the graphical representation of the data of Multi-purpose Cooperative(MVMPC) Online Loan Management System, Modeling its process aspects.

Data flow Diagram

Data flow Diagram

Data Dictionary

A data dictionary contains a list of all files in the database, the number of records in each file, and the names and types of each field. Too many database management systems keep the data dictionary hidden from users to prevent them from accidentally destroying its contents.

Data dictionaries do not contain any actual data from the database, only book keeping information for managing it. The tables below present the relationship of the data and all information to the flow of the system.

Table1. Application table


Field Name Data Type Field Size Description
a_id Int 11 Primary key
Image Varchar 100 Borrowers Image
Lastname Varchar 20 Username
Firstname Varchar 20 Password


Middlename Int 11 Primary Key
Gender Varchar 100 Image
Email Varchar 50 Foreign Key
Occupation Varchar 50 Year Applied
Address Varchar 60 Full Name
number Text Number of the borrower
DateApplied Varchar 50 Date Applied
amount Int 11 The Number Of Term
Year Varchar 20 Year Applied
savings Int 11 Savings
Loantype Varchar 50 Types of loan
duration Int 11 Due date
datereleased Varchar 50 Date released
Status Varchar 50 Status of the borrower


Table2. Payment Table

Field Name Data Type Field Size Description
P_id Int 11 Primary key
A_id Int 11 Foreign key
amount Int 11 Amount applied
Text_mess Text Text Message
Date Varchar 50 Date

Table3. Loantype Table

Field Name Data Type Field Size Description
loan_id Int 11 Primary Key
LoanName Varchar 50 Loan Type
Rate Varchar 10 Interest rate
Description Text Description


Table4. User Table

Field Name Data Type Field Size Description
U_Id Int 11 Primary key
A_username Varchar 50 Applicant Username
A_Password Varchar 30 Password
Name Text Name


Use Case Diagram

This figure shows the interaction of the admin and the assistant (user) to the system, on what are the task they both undertake and their differences.

Use Case Diagram

Use Case Diagram

Administrator Activity Diagram

The administrator logs in to the system. The admin can manage client details, can add, update, view, delete and print records of client it can also compute mortgage details.

Activity Diagram

Activity Diagram

Gantt Chart

Gantt chart is one of the most popular and useful ways of showing activities (task or events) displayed against time. Each activity is represented by a bar, the position and length of the bar reflects the start date, duration and end date of the activity.

Gantt Chart

Gantt Chart

Presentation, Analysis And Interpretation Of Data

This chapter presents and interprets the results of the User’s Acceptance Survey in the system for  Market Vendors Multi-purpose Cooperative Loan Management.


          The proponents select the respondents to be evaluated randomly and demonstrate the system based on their knowledge of interest in computers. The proponents evaluated them using the User Acceptance Survey questionnaire provided by the capstone adviser and gather the data in order to work on the statistical formulas afterwards.

Data Analysis

          This section presents the analysis of the data collected from the respondents from the  Market Vendors Multi-purpose Cooperative staff and members.

Characteristics of the Respondents

          The study’s population was composed of the owner of  Market Vendors Multi-purpose Cooperative including the Bookkeeper, Secretary and Staff as well as the students as the future beneficiaries of the proposed study.

Table 4.0: Frequency of Respondents

                             Respondents                                              Frequency

Admin                                                                  1

Assistant                                                               1

Members and Staff                                               23

Students                                                               5

Total                                                                     30


This table shows the frequency of respondents who have answered the User-Acceptance Survey. The Researcher got a total of 30 respondents.

Reliability Testing

          The data gathered by the proponents have undergone reliability testing. An acceptable approach through using the Yamane’s Formula in order to identify the sample size of population that will undergo the user Acceptance Survey.

n – The sample size

N – The population size

e – The acceptable sampling error

= 95% confidence level and p = 0.5 are assumed


n  =30


n  =   30



n  =   30


n  =   30


n=27.90 or (28)

This table shows the result of reliability testing undergone by the data gathered from the User-Acceptance Survey. The (n) stands for sample size, the (N) stands for total population size of respondents, which is 30. The acceptable sampling error  has a value of 0.05 multiply by itself with a result of 0.0025. The population size (n) which is 30 divided by 1.075 the total survey result is equivalent to 27.90 or 28.

Interpretation of Data

The instrument wished to access the perception of the users in terms of five (5) categories namely: Effectiveness, Efficiency, Quality, Timeliness and Productivity. The first category was composed of four (4) items, the second category was composed of three (3) items, and the third, fourth and last categories were composed of four (4) items. The rating scale was 1 to 5 with 1 as very dissatisfied, 2 as dissatisfied, 3 as neutral, 4 as satisfied and 5 as very satisfied.

Table 6.0: Rating Scale

                             Range of Mean                                 Verbal Interpretation

4.21 – 5.00                                        Very Satisfied

3.41 – 4.20                                        Satisfied

2.61 – 3.40                                        Neutral

1.81 – 2.60                                        Dissatisfied

1.00 – 1.80                                        Very Dissatisfied

This table shows the range of mean and its verbal interpretation.

Respondents Survey Result

Respondents Survey Result

Figure 6 shows the result from the User’s Acceptance Survey wherein 30 respondents have been tested. Each of the categories average was computed. Each computed averages were created tables below to precisely showcase each category’s mean. Users were satisfied with the system’s effectiveness after testing it.

Table 7: Survey Result – Effectiveness



          Question 1 Question 2 Question 3 Question 4            TOTAL

Mean           4                 4                 4                 4.2                4.1

          Table 7 shows that the user’s survey result for the effectiveness of the system has a total mean of 4.1 which interprets that the users were satisfied with the systems effectiveness.

Table 8: Survey Result – Efficiency



          Question 1            Question 2            Question 3           TOTAL

Mean           4.1                        4                           3.3              4

          Table 8 shows that the user’s survey result for the efficiency of the system has a total mean of 4 which interprets that the users were satisfied with the systems efficiency of the system after testing it.

Table 9: Survey Result – Quality



          Question 1 Question 2 Question 3 Question 4            TOTAL

Mean       4.1                  4             4.1                   4                   4.1

          Table 9 shows that the user’s survey result for the quality of the system has a total mean of 4.1 which interprets that the users were satisfied with the systems quality of the system after testing it.

Table 10: Survey Result – Timeliness


Question 1 Question 2 Question 3 Question 4            TOTAL

Mean           4            3.7                    4                 4                   3.9

          Table 10 shows that the user’s survey result for the quality of the system has a total mean of 3.9 which interprets that the users were neutral with the systems timeliness of the system after testing it.


Table 11: Survey Result – Productivity


          Question 1            Question 2            Question 3            TOTAL

Mean           4                     4.1                           4.1                    4.1

          Table 11 shows that the user’s survey result for the quality of the system has a total mean of 4.1 which interprets that the users were satisfied with the systems productivity of the system after testing it.

Based on the tables above, the result of the study’s User’s Survey is above average. There’s no rating below 1. Therefore, it attest that it is a good survey and it is a good system.

Summary of Findings, Conclusions and Recommendations

          This chapter presents the summary of the system project, the findings of the study and the conclusion based on the findings. Recommendations are given as called for by the findings of the study.

Summary of Findings

          The proponents conducted series of interviews to the company to identify the main problem of the administration. After the evaluation and thorough research, the proponents started to create a system that would help the company to minimize and improve the business process.

Multi-Purpose Cooperative (MVMPC) Loan Management System with SMS notification focus on automation of loan procedure wherein the borrowers are notified directly, transactions are easier, reports of payments can easily monitor and update borrower’s information.

The proponents conducted a user acceptance survey to evaluate the acceptability of the users to the Loan Management System with SMS notification if it could get a good average rate when it comes to its system effectiveness, efficiency, quality, timeliness and productivity. As the result shown in Chapter 4, the system get an average rate of 4.03 .


          Based on the findings, data and feedback that was being gathered in the whole chapter, the proponents concluded that the system is useful to the company because it can directly generate reports of payments and can notify borrowers accurately about their transactions. After methodical process, proponents have achieved all the objectives of the study.


          In the view of the findings and conclusions of the study, the following are recommended to further improve this project:

  1. With the use of the system, the company will become more competitive and attract more borrowers and can offer better quality of service.
  2. The administration should use the system so they can easily manage their business.
  3. Improving the interface of the system by making it more responsive and adaptive as possible.
  4. The future researchers who want to use this study as a basis can improve the project by other more functionalities that will exist in the loan process in the future.
  5. Continuous system testing will be done on more respondents to improve the functionalities of the study.



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