In this modern and rapidly economic environment, we can all agree that the pandemic has greatly affected the credit worthiness of the customer. This new normal is a challenge to everybody. Thus, it is an advantage to have some tools in credit risk management and cash flow protection, such as CMAP’s very own database “iCMAP”. The following are tools commonly used in credit risk management.
Credit apps
Credit apps are easy and convenient to use because of their availability anywhere online and anytime whether you are working in the office or a remote location. The credit ratings from various credit rating agencies are easily viewed using apps like this. Some apps also have notifications that can make you aware about the latest changes in the credit rating of your clients.
Trade References
Trade references are other businesses your client has done transactions with. Inquiry regarding the client payment history is available upon directly contacting the references. This is very helpful but it is time consuming and needs to be updated regularly.
Credit applications
The credit risk management of the client will begin upon submission of a credit application. This lists all the necessary information that is vital in making a credit decision. It will include details such as company information, financial information, and bank and trade references,
Dashboard
This tool uses an automated credit management solution by providing a dashboard for each account that can be used in making credit decisions. There is a color scaling which is used to rank credit quality. This tool lessens the time you need to spend contacting customers because of its automated system.
Reference: lockstep.io