Execution Process of Consumer Credit Scheme

12 Pages Posted: 24 Dec 2008 Last revised: 22 Jan 2009

See all articles by Mohammad Shamsuddoha

Mohammad Shamsuddoha

University of Chittagong; Western Illinois State University

Date Written: December 23, 2008


There are cardinals principles of consumer credit lending that have been followed by the local and foreign commercial banks since long. These are the principles of safety, liquidity and profitability. The first and foremost principle of lending is to ensure the safety of the funds along with interest, according to the terms of loan contract. Secondly, banks are lending funds for short periods and mainly for less risk of capital. Banks always want to liquidate their capital as early as possible due to risk. Finally, commercial banks are profit earning institutions that is why, banks always looks greater profit in their consumer credit scheme (Sundharam, 1995). There are some others principles in lending consumer credit to the customers such as purpose of loan, diversification of risk, following the national policy and less risk financing.

Keywords: consumer Loan Execution, Personal Loan, Bangladesh, Bank

Suggested Citation

Shamsuddoha, Mohammad, Execution Process of Consumer Credit Scheme (December 23, 2008). Available at SSRN: https://ssrn.com/abstract=1319831 or http://dx.doi.org/10.2139/ssrn.1319831

Mohammad Shamsuddoha (Contact Author)

University of Chittagong ( email )

Department of Marketing, Faculty of Business Admin
University of Chittagong, Bangladesh
Chittagong, Chittagong 4331

HOME PAGE: http://www.shamsuddoha.webs.com

Western Illinois State University ( email )

School of Management and Marketing
Macomb, IL 61455
United States
61455 (Fax)

HOME PAGE: http://www.wiu.edu

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