What happens when an employer MOU expires
An employer MOU has an effective window, and when it lapses the authority to deduct from that employer's payroll lapses with it. In Ustawi the immediate, practical effect is on new disbursements: without a live MOU, that employer's staff cannot take out a check-off loan until the agreement is renewed.
The immediate effect
A live employer MOU is a disbursement requirement gate for check-off products. When the MOU expires, the gate is no longer green, so any approved-but-undisbursed check-off loan for that employer's staff is blocked from disbursing. The credit decision may be complete, but the legal basis to deduct is not in force — so the money does not move.
What is and isn't affected
- New disbursements — blocked. A check-off loan for that employer's staff cannot disburse while the MOU is expired.
- Batch eligibility — loans enter deduction batches under an active MOU, so an expired MOU affects which loans are eligible to be batched.
- The MOU record — not deleted. It remains on file with its history so the lapse and any renewal are visible.
Restoring the gate
Renewing the agreement and setting the employer's MOU back to active restores the gate. Once the MOU is live again, that employer's approved check-off loans can disburse and their loans are again eligible for deduction batches. Treat an approaching expiry as something to renew ahead of time, so a pipeline of approved loans is not left waiting.
If an approved check-off loan will not disburse, check the employer's MOU status before anything else — an expired MOU is a common, and quickly fixable, cause.