Credit Management

A Project To University Of Mumbai For Partial Completion Of The

Degree Of Bachelor In Commerce (Accounting & Finance) Under The
Faculty Of Commerce.

By
Shree Naik
Under Guidance Of
prof. ratnavli maam

J.B.S.P.C.K.T. College , New Panvel

2020-21
 Introduction
O The term credit is derived from the Latin credo, “I believe" or
"I trust. "Credit implies a condition of trust between borrower
and lender that the funds (or goods) lent will be repaid.
the past, when the economy operated on a simpler basis and
Biblical prohibitions against usury were taken more seriously,
a person would lend money to a friend on trust.
CHARACTERISTICS OF CREDIT
1. Confidence
2. Capacity
3. Security
4. Goodwill
5. Size of credit
6. Period of credit
 TYPES OF CREDIT

TRADITIONAL CREDIT PRODUCTS:

1. Cash credit:
2. Overdraft:
3. Demand loans:
4. Term loans:
5. Bill purchased:
6. Bill discounted
CREDIT INSTRUMENTS
Cheque
Bank draft
Bill of exchange
Promissory note
Government bonds
Treasury bills
Traveler‟s cheque
ADVANTAGES OF CREDIT
1. Exchange of ownership
2. Employment encouragement
3. Increase consumption
4. Saving encouragement
5. Capital formation
6. Development of entrepreneurs
7. Easy payment
8. Elasticity of monetary system
9. Priority sector development:
DISADVANTAGES OF CREDIT
1.Encouragement of expenditure
2. Encourage weakness
3. Economic crisis
4. Dangers beyond limit
5. Evil of monopoly
6. Encourage inefficient