When a borrower presents an active GSTIN as part of a loan application, credit teams typically treat it as a green flag. The business is registered, the number is valid, and the portal confirms it’s active. Move on to the next document. That’s the wrong conclusion to draw. A GSTIN validation check confirms one thing: […]
For most salaried borrowers, a bank statement is enough. The income is regular, repayment capacity is calculable, and the bureau report fills in the credit history. MSME borrowers are different. Business income moves across multiple accounts, sometimes in cash. A business with five years of operating history may still have a thin or inconsistent bank […]
Most guides on credit underwriting spend a lot of words explaining what it is. This one focuses on what each stage requires: the documents, data points, and checks a lender needs before the next stage begins. Delays rarely happen at the decision point. They happen because one stage is waiting on something the previous stage […]
Before a business loan is approved, the credit team needs to answer one core question: Can this borrower actually repay what they’re asking to borrow? Not just based on what they say their revenue is, but based on what their operating income looks like after normal business expenses are covered. The Debt Service Coverage Ratio, […]
When you pull a credit bureau report as part of a loan assessment, the account status column tells you more than just whether a loan is open or closed. Two entries require careful interpretation: “Settled” and “Written Off.” They look similar on the surface. They read very differently from a risk standpoint, and conflating them […]
When a business applies for a term loan, DSCR is among the first ratios a credit team runs. The formula is straightforward: divide net operating income by total annual debt service. A ratio above 1.25 typically signals adequate repayment capacity. Drop below that, and the conversation gets harder. The problem sits one step earlier: in […]
A Credit Appraisal Memorandum (or CAM report) is the internal document a credit team prepares before recommending or rejecting a loan. Its job is to tell the credit committee, with documented evidence, whether a borrower can repay. Every section in a well-built CAM exists to answer some part of that question, and the sections that […]
Most credit teams have a recognisable workflow when reviewing bureau reports: score first, NPA status second. The inquiry count gets a glance at most. The DPD section gets a cursory look at most, sometimes none at all if the score is above the internal threshold. That’s where risk slips through. Days Past Due (DPD) is […]
The Account Aggregator (AA) framework was built to solve a real problem. Borrowers no longer need to collect physical bank statements, lenders get verified, tamper-proof financial data, and the entire consent-based flow happens in minutes rather than days. In theory, it’s a clean system. In practice, it breaks down more often than lenders publicly acknowledge. […]
A Credit Appraisal Memorandum is the backbone of any lending decision. It brings together bank statement analysis, GST returns, credit bureau data, and financial ratios into a single document that tells the lender whether a borrower is creditworthy or not. The problem? Building one manually is slow, error-prone, and not a great use of a […]
