Different businesses factor in varying levels of risk appetites, subject to market stimuli. Thus it is imperative for all trade partners to decide the kind of risk they are willing to be exposed to, in terms of credit, as risk taking preferences could vary from trade partner to trade partner. Hence, every time an invoice is raised, 2 credit checks must be incorporated; one that maps the credit limit and the other that maps the credit period, as in a non-eXchange environment, defaults can occur on either.
On the eXchange the principal cumulatively decides what level of risk he is willing to expose himself to, and sets both credit checks in terms of limit and period to be performed by the system, before an order is accepted. How the eXchange does this is simple, it generates information based on the credit period, and automatically runs algorithms that confirm if the order should be accepted, clearing first what falls in dues.
The eXchange offers:
- Incorporation of specific credit limits
- Configuration of credit checks
- Filtering of both credit limit and period
- Application prior to order acceptance
The eXchange helps to ascertain that every order placed is eligible for transaction, avoiding order complications that could hamper future revenue generating opportunities amongst trade partners. Simply by incorporating credit checks in place, that alert the systems user about an inappropriate order before an order is accepted.
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