Loan Application System

A microservices-based loan application system built to learn and demonstrate core backend engineering concepts. Built with Spring Boot, MySQL, Redis, Docker, and Kubernetes.

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What this project does

A user registers and logs in to get a JWT token. They can then apply for a loan by submitting their financial profile. The system runs eligibility checks and either approves or rejects the application. Admins can then approve, disburse, or close loans.

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Services

• service-discovery (port 8761) — Eureka server, all services register here
• user-management (port 8081) — handles registration, login, JWT
• loan-eligibility (port 8082) — handles loan applications and eligibility engine

Each service has its own database. They communicate via REST using WebClient.

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Concepts implemented

• JWT authentication and Spring Security
• @Transactional with pessimistic row locking to prevent race conditions
• Idempotency keys to prevent duplicate loan applications
• Redis caching for user data and eligibility results
• Rate limiting with Bucket4j (3 requests per hour per user)
• Circuit breaker with Resilience4j on the user-service call
• Database indexing on frequently queried columns
• Eureka service discovery
• Docker and Docker Compose for local setup
• Kubernetes deployment using minikube

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Tech stack

• Java 17, Spring Boot 3
• MySQL, JPA/Hibernate
• Redis (Lettuce)
• Resilience4j, Bucket4j
• Netflix Eureka
• Docker, Docker Compose
• Kubernetes (minikube)

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How to run locally

1. Build all services

cd service-discovery && ./mvnw clean package -DskipTests && cd ..
cd user-management && ./mvnw clean package -DskipTests && cd ..
cd loan-eligibility && ./mvnw clean package -DskipTests && cd ..

2. Start everything

docker-compose up --build

3. Access

• Eureka: http://localhost:8761
• User service: http://localhost:8081
• Loan service: http://localhost:8082

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How to run on Kubernetes

1. Start minikube

minikube start

2. Point Docker to minikube

# Windows
minikube docker-env | Invoke-Expression
# Mac/Linux
eval $(minikube docker-env)

3. Build images

docker build -t service-discovery:latest ./service-discovery
docker build -t user-management:latest ./user-management
docker build -t loan-eligibility:latest ./loan-eligibility

4. Deploy

kubectl apply -f k8s/namespace.yml
kubectl apply -f k8s/mysql/
kubectl apply -f k8s/redis/
kubectl apply -f k8s/service-discovery/
kubectl apply -f k8s/user-management/
kubectl apply -f k8s/loan-eligibility/

5. Access services

minikube service user-management -n loan-system
minikube service loan-eligibility -n loan-system

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API endpoints

Register

POST /api/auth/register
{
    "username": "john",
    "password": "pass123",
    "email": "john@gmail.com",
    "fullName": "John Doe"
}

Login

POST /api/auth/login
{
    "usernameOrEmail": "john",
    "password": "pass123"
}

Apply for loan

POST /api/loans/apply
Authorization: Bearer <token>
{
    "loanType": "PERSONAL",
    "requestedAmount": 500000,
    "tenureMonths": 24,
    "idempotencyKey": "unique-key-001",
    "applicantProfile": {
        "nationality": "Indian",
        "location": "Hyderabad",
        "incomeSource": "SALARIED",
        "monthlyIncome": 50000,
        "cibilScore": 750,
        "existingLoanCount": 0,
        "totalExistingEmi": 0
    }
}

Other loan endpoints

GET  /api/loans/my-loans          — get all my loans
GET  /api/loans/{id}              — get loan by id
PUT  /api/loans/{id}/approve      — admin only
PUT  /api/loans/{id}/reject       — admin only
PUT  /api/loans/{id}/disburse     — admin only
PUT  /api/loans/{id}/close        — admin only

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Eligibility rules

• CIBIL score must be at least 650
• Monthly income must be at least ₹25,000
• Cannot have more than 3 existing loans
• Total existing EMI must not exceed 50% of monthly income
• Cannot have an active loan application already

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Loan lifecycle

APPLIED → UNDER_REVIEW → APPROVED → DISBURSED → CLOSED
                              ↓
                          REJECTED