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Tag: Credit analyst online training

Master The Art Of Credit Analyst Course With These 5 Tips

Posted on by Imarticus Learning

Master The Art Of Credit Analyst Course With These 5 Tips

The world has undergone drastic changes in recent years, and the pace of change shows no signs of slowing down. Along with many other industries, the employment market is going through a paradigm transition as new technologies render obsolete formerly in-demand talents.

An overview of the Credit Analyst Course

The initial step in becoming a credit analyst is taking a course that covers the basics of the position. A credit analyst course should cover financial statements, accounting, and credit reports. Bringing a credit analyst course is a great way to learn the basics of the job. However, it is also essential to have some real-world experience. Many credit analyst courses include an internship component. It allows students to get hands-on experience working in the field.

It is also essential to stay up-to-date on industry news and trends. Credit analysts need to be able to understand and interpret financial data. They also need to be able to explain their findings to clients or managers. Reading industry publications or taking additional courses can help credit analysts stay current in their field.

Tip One: Get Educated

There are many different types of credit analyst courses available, and you must choose one that is right for you. Colleges and universities offer online classes and courses. You must find a course that fits your schedule and learning style.

Tip Two: Practise Your Skills

Another tip for mastering the art of credit analyst course is to practice what you have learned. After you have completed a course, take some time to practice your skills. You can work with friends or family members who have good credit. This will help you learn how to analyze credit reports and decide whether someone is a good candidate for a loan.

Tip Three: Build Your Network

One of the best ways to become a credit analyst is to build your professional network. Connect with other analysts and professionals in the field to learn about new opportunities and stay up-to-date on industry news. Attend industry events and seminars to meet new people and make valuable contacts. The more people you know, the better your chances of landing a great job as a credit analyst.

Tip Four: Be Professional

It is essential to be professional when you are working as a credit analyst. This means being able to communicate effectively with clients and co-workers and able to maintain a high level of accuracy in your work. It is also essential to work well under pressure, as credit analysts often have to meet deadlines.

Explore a career in credit analysis with Imarticus Learning

Students learn about the lending environment, credit underwriting, and regulatory requirements with this credit risk certification in India. 

Course Benefits For Learners

  • The practical career-focused program complies with internationally accepted standards and incorporates the most recent global trends and best practices.

  • The curriculum for credit management courses online consists of 145 hours of live lectures, five case studies, and social learning.
  • Credit analyst online training is practice-based, tied to globally recognized standards, and industry-focused. It is unique because it includes the most modern educational advancements worldwide!

Contact us through the chat system, or drive to our training centers in Mumbai, Pune, Thane, Chennai, Bengaluru, Delhi, Gurgaon, or Ahmedabad.

Legal Framework in India For Credit & Lending Introduction!

Posted on by Imarticus Learning

The legal framework in India is predicated on two acts, the 1949 Banking Regulation Act and the 1934 Reserve Bank of India Act. BR act helps to manage and supervise banking activities, acts as a banking guideline, whereas the RBI act authorizes RBI to issue currency notes, regulate all banks, and take care of the economic and financial situation of the country.

To get in-depth knowledge and understanding of the legal framework in India for credit and lending, you ought to choose a credit analysis course or a PGDM in banking and finance.

Banking Framework

Under the given framework, banks are allowed to perform the below activities:

  • Borrow or grant loans: Loan terms are set by negotiation and could be without any security too.
  • Issue credit letter: This letter ensures the customer would pay money to the vendor and just in case of the buyer’s default, the bank pays the amount. It’s crucial for international trade.
  • Issue promissory note: It’s a legal document, in which one party promises in writing to pay a determinate sum of cash to the other, either in a determinable future time or on demand of the payee, under specific terms.
  • Issue bill of exchange: A bill of exchange may be a written order that is in international (export/import) trade binding one party to pay an amount of cash to a different party at a scheduled date or on demand of the same.
  • Apart from that, banks are allowed to deal in stocks, shares, provide vaults, perform guarantees, fund charitable causes, promote their business and merchandise.

Features Of Banks Under Legal Frameworks

Let’s explore a few more features and aspects of banks under the legal frameworks:

  • Cash reserve: Every depository financial institution needs to take care of a sum like a percent of the demand in total and time liabilities with itself (referred to as Statutory Liquidity Ratio) and with the Federal Reserve Bank (referred to as CRR, or Cash Reserve Ratio) to regulate the credit growth and liquidity within the economy.
  • Private banks, co-operative society, small finance banks, and payment banks:
    • To operate in India, for private banks, the initial minimum paid-up capital is 200 crores, of which the promoter must pay 40% with 5 years locking, and the initial 200 crores need to raise to 300 crores in 3 years.
    • Co-operative societies also come under the BR act.
    • Small finance banks and payment banks are licensed under the BR act. To boost financial inclusion by providing aid to unorganized sectors, micro industries were introduced. Payment banks aren’t allowed to supply loans.
    • Regional Rural Banks: Regional Rural Banks with the target of providing sufficient funds to rural sectors and agriculture, was established and controlled under the RRB act 1976. National Bank for Agriculture and Rural Development regulates these banks.

RBI Lending Policies

More about RBI lending policies:

  • Recently, RBI relaxed lending norms to NBFC and also provided relaxation in bank’s exposure to limits, in order to assist under-stress sectors.
  • RBI allowed banks to prioritize agriculture, micro-small-medium industries, and affordable housing while granting loans.
  • Banks now can grant loans to agriculture with the capping of up to Rs 10 lakhs and to micro and little enterprises up to Rs 20 lakhs and to housing sector up to Rs 20 lakhs per borrower, and it is assessed as priority sector lending.
  • The RBI increased the loan exposure limit of banks to a single NBFC from 15% to 20% of its capital base, to aid increased credit supply to the crisis-ridden shadow banking sector.

Conclusion

The legal framework in India for credit and lending is vast and needs extensive study to become fully accustomed to it. And also, based on the economic situation, norms tend to update or new regulations come into the picture. To understand this, you should either go for a PGDM in banking and finance or at least take a credit analysis course, to begin with.

The Reason why Credit Under Writing Can’t be 100% Automated!

Posted on by Imarticus Learning

Over the past decade, AI & ML have transformed the Fintech industry in different ways. Whether examining use cases such as general robotic process automation (RPA), chatbots and Robo-advisors, personalized banking, cybersecurity & fraud detection, or numerous others, AI has streamlined processes for financial institutions & consumers. One of the most complex applications of AI is predictive technology for credit underwriting & risk monitoring.

But, some benefits of both AI & ML notwithstanding, several obstacles hinder the comprehensive automation of credit underwriting. Here’s all you need to know on why Credit Underwriting can’t be automated 100%.

Regulatory barriers, restrictive black-box algorithms, and other challenges

While there exists a seemingly infinite list of benefits, expecting swift & 100 percent automation of credit underwriting could go wrong for a while. There are technological shortfalls & regulatory roadblocks due to which 100% automation may not be achieved yet. The most significant barrier is the lack of explainability within AI. As a result of meticulous regulations the financial institutions face, AI models need to produce a definite explanation & reason for each decision, prediction & risk assessment.

While ML applications grow in specialized ways, the models become increasingly opaque and are challenging to interpret. The ability to define the black box, non-linear models, is critical, especially in finance, which makes both the predictive output & accuracy of prediction critical. To satisfy the regulatory demands, AI models should render plain-text & interpretable explanations, which is currently a challenge.

Another common barrier hindering wider adoption & complete automation of credit underwriting is data access. Lack of quality datasets may create issues in smooth functioning that may hamper operations as well. Minimal or compromised datasets are factors that are responsible for derailing a successful model. This is why predictive models must have access to global, varied & diverse datasets to achieve the highest levels of prediction accuracy.

Other hurdles include limiting third-party data silos that need administrative permission and overall prediction accuracy, which notoriously varies among different models & AI technologies.

The Future Path to Automation

In the upcoming decade, AI isn’t eyeing to replace credit risk officers. Instead, credit risk officers who utilize AI will replace those who aren’t handy with these tech-based solutions. We are currently in the latter stages of those initial decades when it comes to AI-assisted credit underwriting.

credit analysis courseBut automation will not sweepingly eclipse the work of fintech professionals. The expert human overview will be required to assure accuracy for cases of outliers & eliminate self-selection & biases.

For those eyeing a career in Banking and Finance, it is an opportunity to clinch the technology and fly high with the aspirations. A certificate course in banking and finance is an excellent option for employment after graduation or after B. Com!

Learn and Grow with Imarticus Learning:

Get an in-depth understanding of the dynamic banking and non-banking financial corporations (NBFC) loan markets through the Credit Risk and Underwriting Prodegree offered by Imarticus Learning.

In this Credit Risk and Underwriting Prodegree, students are empowered to acquire a powerful toolkit that helps you understand India’s credit landscape, learn the entire loan assessment process and due diligence and conduct financial analysis.

They get a hands-on learning experience as you explore five comprehensive case studies. Each case study is linked to a different aspect of the curriculum, providing you with an opportunity to apply your skills and gain an in-depth understanding of how credit risks and underwriting works.

For further details, contact us through the Live Chat Support system or visit our training centers in Mumbai, Thane, Pune, Chennai, Bengaluru, Hyderabad, Delhi, Gurgaon, and Ahmedabad.

Credit Underwriting Standards: A Challenge for Smaller Banks!

Posted on by Imarticus Learning

The main revenue for a bank always comes from the money they lend to different borrowers. The interest obtained on that lent money generates revenue for them. Now, this lending process exposes a bank to risks.

In this article, we will discuss various aspects of credit underwriting standards and the importance of a credit analyst course or a PG diploma in banking and finance.

What are Credit Underwriting Standards?

Underwriting standards are a set of guidelines defined by banks or lending institutes, to determine if a loan applicant is qualified for the loan or credit. Credit underwriting standards determine the loan amount, loan terms and tenures, rate of interest, etc. This credit underwriting standard works as a risk management process that helps minimize the risk factor from the lent loan.

Key factors of Credit Underwriting

There are some basic points a bank should consider before granting the loan.

  • A common problem faced by credit approvers is that they often don’t get sufficient financial information from the applicant.
  • An efficient cash-flow projection report can be prepared with enough historical data, balance sheet statements, and a financial analysis system. However, appropriate information needs to be obtained from borrowers regarding expected trends, upcoming capital structure and incorporated in cash-flow modeling for better prediction.
  • Rating models can be efficiently predictive and render an effective early caution against credit deterioration only when the data fed to them are quality data.
  • When the process is more manual and duplicate data is kept in multiple systems, it causes an increase in “time to cash”. The key factors that contribute to “time to cash” are the market environment, the efficiency of decision-makers, and system infrastructure.
  • To understand the key performance indicators and meet the audit requirements, extracting the right data is essential. Also, a user-friendly way of capturing data and a strict well-defined process is essential to make sure the data is correctly apprehended and managed.
  • Understanding the business model sustainability of the borrower is important. The borrower should have better alignment between business strategy and financially reliable sectors to recover the losses when one sector is underperforming.

Challenge for Smaller Banks

When it comes to smaller banks, they face few challenges while maintaining credit underwriting standards, which either cause problems for them in the present or might create in the future.

  • Major small banks face significant challenges in terms of their ability to produce, manage and maintain sufficient data. This is a clear indication that small banks suffer due to a lack of IT infrastructure and strong risk governance policies.
  • Another key trend among smaller banks is that because of the extremely competitive market, the interest rates that banks offer on loans are not calculated based on the underlying credit risk of those loans, but rather they are more intended towards capturing the market. This lack of risk-based pricing may cause a future inability to recover the money lent.
  • The banks are launching new products, offers, expanding themselves into new markets, re-adjusting risk strategies because of intense market competition. There was a drop in average lending margins which basically reduced the overall profit margin for a bank.

Conclusion

Credit risk management comes with various challenges. Proper analysis of quantitative and qualitative data, decision-making ability, and mutual relationships can help to reduce the risk and only a properly trained professional can do that.

When you are looking for a career in the banking sector, deep knowledge of credit underwriting standards is essential.

Credit risk underwriting courseA credit analyst course or PG diploma in banking and finance may help you to achieve that. Credit Risk and Underwriting Prodegree In Collaboration with Moody’s Analytics is such a tailor-made course for you.