Skip to main content

Loan Product & Credit Risk Assessment

Product Overview​

Product Parameters​

Loan Features​

loan_product:
  amount:
    minimum: 100000 SAR
    maximum: 500000 SAR
    increment: 10000 SAR
    
  term:
    minimum: 6 months
    maximum: 36 months
    increment: 1 month
    
  profit_rate:
    base_rate: 13%
    risk_premium: 0-7%
    
  purpose:
    allowed:
      - working_capital
      - business_expansion
      - equipment_purchase
      - inventory_financing

Eligibility Criteria​

Eligibility Requirements​

eligibility:
  business:
    types:
      - sole_proprietorship
      - limited_liability_company
      - professional_company
    minimum_age: 1 year
    minimum_revenue: 1000000 SAR
    
  financial:
    bank_statements: 12 months
    credit_score: minimum 650
    debt_service_ratio: maximum 40%
    
  documentation:
    required:
      - commercial_registration
      - tax_registration
      - bank_statements
      - financial_statements

Credit Risk Assessment​

Risk Scoring Model​

risk_scoring:
  components:
    business_profile:
      weight: 30%
      factors:
        - business_age
        - industry_type
        - management_experience
        - market_position
        
    financial_health:
      weight: 40%
      factors:
        - revenue_trend
        - profitability
        - cash_flow
        - working_capital
        
    credit_history:
      weight: 30%
      factors:
        - credit_score
        - payment_history
        - existing_obligations
        - credit_utilization

Approval Process​

Approval Levels​

approval_levels:
  level_1:
    amount: <= 200000 SAR
    authority: Credit Officer
    risk_score: >= 750
    
  level_2:
    amount: <= 350000 SAR
    authority: Credit Manager
    risk_score: >= 700
    
  level_3:
    amount: <= 500000 SAR
    authority: Credit Committee
    risk_score: >= 650

Risk Monitoring​

Monitoring Parameters​

monitoring:
  portfolio_review:
    frequency: monthly
    metrics:
      - delinquency_rate
      - risk_grade_migration
      - sector_concentration
      
  early_warning:
    indicators:
      - payment_delays
      - credit_score_changes
      - financial_deterioration
      
  risk_reporting:
    frequency: monthly
    reports:
      - portfolio_quality
      - risk_concentration
      - provision_coverage

Collection Process​

Collection Stages​

collection_stages:
  early_stage:
    days_past_due: 1-30
    actions:
      - payment_reminder
      - phone_call
      - email_notification
      
  mid_stage:
    days_past_due: 31-60
    actions:
      - collection_letter
      - site_visit
      - payment_plan
      
  late_stage:
    days_past_due: 61-90
    actions:
      - final_notice
      - legal_warning
      - restructuring_option

Best Practices​

Risk Assessment​

  1. Comprehensive evaluation
  2. Multiple data sources
  3. Regular model validation
  4. Industry benchmarking

Portfolio Management​

  1. Diversification strategy
  2. Regular monitoring
  3. Early intervention
  4. Risk-based pricing

Documentation​

  1. Complete documentation
  2. Regular updates
  3. Audit trail
  4. Compliance checks

Compliance​

  1. SAMA guidelines
  2. Credit bureau reporting
  3. Documentation standards
  4. Regular audits