Traditional Culture Encyclopedia - Traditional customs - Credit Quality in 5c System
Credit Quality in 5c System
Credit 5C analysis is to analyze customers' or customers' credit standards through the "5C" system, that is, to evaluate customers' or customers' credit quality from five aspects: quality, ability, capital, mortgage and conditions.
origin
Western commercial banks have summed up the "5C" principle in their long-term operation, which is used to analyze the credit risk of borrowers. Some banks summarize the analysis factors as "5W" factors, that is, the borrower (who), the purpose of borrowing (why), the repayment period (when), the collateral (what) and how to repay (how), while others summarize it as "what".
That is, personal factors, loan purpose, payment, security and prospects.
develop
First of all, 5C analysis is one of the expert analysis methods for financial institutions to analyze customer credit risk. It mainly focuses on the borrower's moral character, repayment ability, capital strength, collateral and conversion, etc., to judge the borrower's repayment willingness and repayment ability.
In recent years, 5C analysis method has been more widely used in the credit evaluation of enterprises to customers. If the customer can't meet the credit standard, he can't enjoy the credit of the enterprise or can only enjoy a lower credit discount.
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