Credit Analysis: Understanding Lenders’ Heads

You must have already made a loan before, but do you know how lenders analyze your payment capacity? Let’s better understand which criteria are used for credit analysis.

Financiers are surplus economic agents. This means that they have money left over, or that reinforces the need for their main main concern as to how to allocate these resources. Given a number of options available in the financial market, one of them is the credit market, which has the finance institution lending money to people or businesses that need the money to achieve their goals.

In order for a lender to be able to lend his money to his company, his biggest concern will be to assess his credit risk, or simply put, to assess whether his business is able to repay the installments on time.


How it works?

credit analysis

Each funder has their own criteria for evaluating you, but their methodologies usually have several common steps, notarially:

Registration: To start any credit operation you must register with the financial institution. This serves to understand your company’s characteristics and key challenges. For example; your operating and payment history, what your business model is, and who your decision makers are. At this stage it is important to verify these who is contracting the debt in name from its company actually has the powers to do so.

Notes and Restrictions: through public consultation with credit protection agencies (SSC, Sarasa and Pacen, for example), the lender seeks to understand if its company has unpaid obligations to banks, suppliers, government agencies or other creditors. . Very high volume of restrictions undermines the result of your credit analysis.

Guarantees: It is common for collateral to be requested to ensure that, in the event of default, the bank may resort to additional equity to get its money back. These may be collateral (such as receivables or real estate) or collateral (surety or collateral). Each type of guaranty has its own rite of analysis, but in general, either the lender seeks to assess liquidity (how quickly they can be converted into cash), or equity support (what is possible to recover from the amount borrowed) and the legal certainty (how fast the guarantee can be enforced) of each collateral.

Financial Indicators: Regardless of the volume of guarantors, the possibility of atrophy in the contracted installments may be sufficient for a potential lender to disapprove of your loan request. To assess whether your company will have sufficient resources to pay debts, institutions often request financial information. These may be financial statements or bank statements. Additionally, the current debt level from its firm also impacts this analysis, given that the larger the amount of debt contracted, the greater the cash flow commitment and the smaller the amount of resources available to repay the debt you are contracting.


How does the bank define my credit risk?

How does the bank define my credit risk?

The most common practice for assessing default risk is the calculation of credit score: based on your business rules, operating strategy and provided with all information provided by your company, the lender analyzes credit risk and the ranking in a note

In general, the result of this analysis defines not only if its operation will be approved or disapproved, but also what the conditions of value, rate and term that the company may contract with that institution.


And how do I calculate my score?

And how do I calculate my score?

For if you have a personal property, please contact us at the cost of your information or the result of your score. However, by understanding the parameters used in credit analysis, it is easy to understand what the result of your credit request will be.

Some credit protection agencies, such as Sarasa, provide online tools for your CNPJ’s Cadastral consultation. Apart from a simple character, it is possible to decide whether to restrict oneself or not to fall as such, and which volume. In fact, some of these credit bureaus provide a note to their company based on their payment history. Additionally, the Williams Bank available at the site with a hardware store to consult all the debts contracted by its CNPJ.

These are some of the tools we use to perform deed of credit at Dolce and assist much lenders, as well as companies, to conduct credit operations with security, assertiveness and in accordance with compatible maize profiles between the parties.

Understand how it works by registering its first operation on our platform. Just click here and get started!

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