Credit Process

Date of Submission


Document Type


Degree Name

Master of Business Administration (MBA)




Howard Fidler



Call No. at the Univ. of New Haven Library

AS 36 .N29 Bus. Adm. 1976 no.3


The primary purpose of this work is to present a broad overview of the credit process involved in commercial markets today.

Over the past four decades open account trade receivables have grown at an unprecedented rate bringing major changes in the world of credit. To deal with these changes brought on by business growth and pressing liquidity pressures, the credit manager has been forced to establish new and different credit methods and tools in order to accomplish his job effectively. With the assistance of the computer, the credit operation has been mechanized to a point,that the credit manager is now free of formerly burdensome routines. Because of this, the role of every credit manager has changed and his importance as a decision maker in the firm has increased.

In this paper an examination of the credit process begins with a review of the nature and function of credit. The types of credit, policies and selling terms relevant to industry groups are explored. Credit department personnel and organizational structure and the investigatory procedures and practices involved in the granting of credit are also detailed. Special emphasis is given to financial and comparative analysis as valuable analytical tools in the credit decision making process.

The concluding chapter outlines several new computerized credit services now available to the ciedit exectuive and the advantages of a credit by exception program in a modern credit department.