Difference in Credit underwriting procedures for Retail and Agri Loans?

Question

Accepted Answer

Credit underwriting procedures differ in Retail and Agri Loans due to varying risk factors and collateral requirements.

Retail loans typically involve individual borrowers with stable income and credit history, while Agri loans involve farmers with fluctuating income and collateral in the form of agricultural assets.
Retail loans may require credit score checks and income verification, while Agri loans may focus more on the value of the agricultural land and crops.
Agri loans may involve assessing the impact of weather conditions and market fluctuations on the borrower's ability to repay, which is not a concern in Retail loans.
Retail loans may have shorter repayment periods and higher interest rates compared to Agri loans due to the perceived lower risk.
Overall, Retail loans focus more on the borrower's financial stability and creditworthiness, while Agri loans focus on the value and stability of agricultural assets.

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