What is credit monitoring of loans and advances?

Credit monitoring  strategies in a bank taking place in two stages namely pre-sanction stage and post sanction stage of loans and advances.  Pre-sanction process involves identification of borrower, the  purpose of  the loan, quantum of loan, period of loan, source of repayment, security for advance, profitability, pre-sanction unit inspection, appraisal of credit proposal, and sanctioning…

What is factoring?

Factoring is commonly identified as accounts receivable factoring, invoice factoring, and sometimes accounts receivable financing. Factoring service is a service that covers (i).Collection of bills, (ii).discounting of bills (iii).maintenance of accounts books in domestic and international trade. Factoring enables companies to sell their outstanding book debts for cash. They sell invoiced receivables at a discount…

What is the difference between factoring and forfaiting?

Though financial transactions involved in ‘factoring’ and ‘forfaiting’ appears alike, these two terms are different in their nature, perception and scope. From the below table, let us find out the key difference between factoring and forfaiting; FACTORING FORFAITING Factoring is a financial arrangement whereby a supplier of goods sells its trade receivables to the factor…

What are the key activities of NABARD?

National Bank of Agriculture and Rural Development (NABARD) was initially promoted by Reserve Bank of India in 1982 under National Bank of Agriculture and Rural Development Act 1981. By its establishment NABARD substituted Agricultural Credit Department (ACD) and Rural Planning and Credit Cell (RPCC) of Reserve Bank of India, and Agricultural Refinance and Development Corporation…