Credit Management in the Financial Sector – KASNEB Syllabus

PAPER NO. 15 CREDIT MANAGEMENT IN THE FINANCIAL SECTOR 

GENERAL OBJECTIVE

This paper is intended to equip the candidate with the knowledge, skills and attitudes required for the administration for credit in the financial sector.

LEARNING OUTCOMES:

A candidate who passes this paper should be able to:

  • Undertake credit    administration    duties    and    responsibilities    in                     financial institutions
  • Align credit assessments in conformity to laid down policies, procedures and practices
  • Assess the impact of lending in promoting business enterprises in  the

CONTENT

Introduction to credit administration

  • Identifying the credit opportunity
  • The credit process
    • Identifying the credit opportunity
    • Credit evaluation
    • Credit decision making
    • Credit monitoring
  • The credit analysis process
  • The five Cs of credit
  • The credit analysis path

Securities

  • Definitions
  • Secured and unsecured debts
  • Features of a good security
  • Types of securities
  • Taking and perfection of securities
  • Documentation of securities
  • Lodging and discharging of securities

Credit facilities

  • Introduction
  • Funded and non-funded securities
  • Management of overdrafts
  • Structuring of credit facilities (Loans and advances)

Credit cards

  • Definitions (credit and debit cards)
  • Importance of credit cards
  • Parties to credit card transactions
  • Main features of credit cards
  • Types of credit cards
  • Assessment and appraisal of credit card applications
  • Managing credit cards’ fraud
  • Credit cards’ risk management
  • Delinquency management

Asset finance and leasing

  • Overview of asset finance
  • Types of asset finance
  • Assessment and management of asset finance risks
  • Choosing the right type of asset finance
  • Definition of leasing
  • Types of leasing
  • Merits and demerits of leasing
  • The leasing process
  • Assessment and appraisal of leasing applications
  • Marketing and leasing
  • Leasing risks management

Hire Purchase

  • Overview of hire purchase
  • Formation of a hire purchase contract
  • Duties and rights of parties to a hire purchase contract
  • Termination of hire purchase contracts
  • Advertising for hire purchase
  • Hire purchase risk management

Types and products of mortgage

  • Introduction to mortgage
  • Types of mortgages
  • Parties to a mortgage transaction
  • Products offered under mortgage
  • Target customers and mortgage financiers
  • Analysing mortgage application propositions
  • Types of documents and registration process
  • Risk management and recovery

Microfinance

  • Introduction to microfinance
  • Distinction between microfinance and microcredit
  • Formulation of policies and procedures
  • Recruitment and retention of clients
  • Savings and lending processes management
  • Loan portfolio management
  • Risk management in MFIs
  • Role of regulatory authorities in microfinance

Cooperative societies

  • Types of cooperatives
  • Cooperative principles and practice
  • Cooperative credit programmes and policies
  • Cooperative structure
  • Savings and lending processes
  • Risk management
  • Delinquency management
  • The future of cooperatives
  • Role of regulatory authorities

Emerging issues and trends



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