A Study on Credit Appraisal Process and Analysis at Kaveri Grameena Bank, Bangalore

Abstract

The Credit Appraisal is an objective of ensuring and keeping the quality of lending and managing the credit risk. The process of Credit Appraisal is multidimensional and incorporates the Management Appraisal, Commercial Appraisal, Financial Appraisal, Economic Appraisal, and Technical Appraisal. The study explains appraisal is done to ensure the recovery of credit along with good supervision, monitoring and relationship. Credit Appraisal is a process in which the banker evaluates the credit worthiness of the potential borrower. This generally includes assessing the borrower’s repayment history and establishing the quality and sustainability of his income. The banker fulfils himself of the great intensions of the borrower more often through the interview or personal discussions. The study also speaks credit related guidelines that are supposed to be followed by all the borrowers. In support of the study, data for the last 5 years has been collected and calculated to examination. The study briefly explains how the bank has been performing from 2013-14 to 2017-18 through referring bank’s annual reports and financial statements. It clearly explains the importance of credit appraising in any of the banks and financial institutions.