Credit Management and Administration

Course Overview:

Credit is a vital component of financial services, enabling growth, investment, and economic development. However, poor credit management can result in financial losses, reduced liquidity, and insolvency risks. This course provides a structured understanding of the key principles, practices, and tools used in effective credit management and administration.

The training is designed for professionals involved in credit operations within banks, microfinance institutions, SACCOs, cooperatives, and other lending institutions. It covers the entire credit lifecycle—from policy formulation, credit assessment, loan disbursement, and monitoring, to recovery and delinquency management.

Participants will gain practical skills and insights needed to improve credit decision-making, reduce non-performing loans (NPLs), and ensure a healthy loan portfolio.

 

Course Objectives:

By the end of this course, participants will be able to:

• Understand the fundamental principles of credit and lending.
• Develop and implement sound credit policies and procedures.
• Assess and evaluate borrower creditworthiness.
• Manage the credit approval, disbursement, and documentation process.
• Monitor and control credit risk and delinquency.
• Implement effective debt recovery and collection strategies.
• Apply best practices in credit administration, compliance, and reporting.

 

Target Audience:

• Credit Officers / Credit Analysts
• Loan Officers / Lending Staff
• Credit Managers and Supervisors
• Portfolio Managers
• Branch Managers of financial institutions
• Staff of MFIs, SACCOs, Cooperatives, and Banks
• Compliance and Risk Management Officers

 

Course Duration:

4 Weeks (flexible based on delivery format)

 

Methodology:

• Expert-led lectures and presentations
• Case studies and simulations
• Role-plays and group exercises
• Templates and checklists for credit analysis and monitoring
• Real-world portfolio performance scenarios

 

COURSE CONTENT

Module 1: Introduction to Credit Management

• Role and importance of credit in financial institutions
• Types of credit (retail, SME, corporate, consumer, agricultural, trade)
• Credit lifecycle overview

Module 2: Credit Policy and Framework

• Developing a credit policy
• Lending limits, terms, and conditions
• Regulatory requirements and internal controls

Module 3: Credit Risk and Risk-Based Lending

• Identifying and assessing credit risk
• Risk-based pricing
• Portfolio risk concentration

Module 4: Customer Due Diligence and KYC

• KYC and AML requirements
• Customer profiling and documentation
• Regulatory compliance in onboarding

Module 5: Credit Appraisal and Evaluation

• 5Cs and 7Ps of credit analysis
• Qualitative and quantitative appraisal
• Personal vs. business loan evaluation

Module 6: Financial Statement Analysis for Credit

• Analyzing income statements, balance sheets, and cash flows
• Key financial ratios: liquidity, profitability, solvency
• Forecasting borrower repayment ability

Module 7: Credit Scoring and Rating Systems

• Developing and applying credit scoring models
• Internal vs. external credit ratings
• Credit score interpretation for lending decisions

Module 8: Loan Structuring and Documentation

• Structuring appropriate loan products
• Security and collateral management
• Legal documentation and enforceability

Module 9: Loan Approval and Disbursement Process

• Approval hierarchy and delegation of authority
• Disbursement conditions and procedures
• Common disbursement risks and how to mitigate them

Module 10: Credit Monitoring and Portfolio Management

• Post-disbursement monitoring tools
• Early warning signs of credit deterioration
• Portfolio analysis and performance indicators

Module 11: Delinquency and Arrears Management

• Causes of delinquency
• Aging of arrears and classification of accounts
• Strategies for early recovery and client engagement

Module 12: Loan Recovery and Collections

• Recovery policies and strategies
• Negotiation and restructuring techniques
• Legal remedies and enforcement

Module 13: Credit Administration and Control

• Credit file management and audit trails
• Role of the credit administration unit
• Compliance and regulatory reporting

Module 14: Non-Performing Loans (NPLs) and Provisioning

• Defining and identifying NPLs
• Loan loss provisioning and impairment
• IFRS 9 and other regulatory frameworks

Module 15: Ethics, Integrity, and Credit Culture

• Ethical issues in credit management
• Conflicts of interest and fraud risks
• Building a strong credit culture within the organization

Module 16: Case Studies, Simulation, and Action Planning

• Credit decision simulation
• Real-life NPL turnaround case studies
• Group action plans for improving credit operations

 

Training Materials and Deliverables

• Participant Handbook / Manual
• PowerPoint Slides per Module
• Sample Credit Policy Template
• Loan Appraisal Checklist
• Financial Ratio Calculator (Excel)
• Credit Monitoring and Recovery Templates
• Certificate of Completion