SAP S/4HANA Credit Management

Solution Overview

SAP Credit Management help companies implement a single company-wide credit policy and use credit analysis results to calculate credit limits – including embedding credit checks into key operational processes.

SAP Biller Direct – an electronic bill presentment and payment solution that 1) lets customers download or pay invoices via bank transfer, card, etc, as well as start the dispute process, and 2) allows vendors to see the approval and payment status of their invoices, including inquiry functionality.

SAP E-Invoicing for Compliance – an e-billing solution that sends customers validated, signed invoice PDFs via email or invoices via EDI – including the compliance checks required in 37 different countries.

SAP Collections and Dispute Management – modules that provide workflow and process support for managing disputes as well as a module that generates prioritized collections work lists that help collections specialists proactively contact customers.

These add-ons can be deployed in a single system, but can pull data together from multiple systems – giving your team a unified view of their receivables, even in a distributed systems landscape.

SAP S/4HANA Credit Management Integration enables you to automate customer credit risk monitoring

With this solution, you are now able to react instantly to changing credit conditions of your customers. Reflect data coming from external sources in your internal processes and credit assessments and therewith improve your scorecard & credit risk assessment accuracy. Easily expand to other agencies with no upfront investment (SAAS solution)

To monitor customers’ credit risk, your credit policy should always contain a solid mix of: 

  • Internal data (like past payment behavior of a particular customer, DSO, sales forecast, etc.) and 

  • External data from external credit information providers / credit agencies (i.e. Creditsafe, Dun & Bradstreet, Euler Hermes, etc.)

External data is important as it will enhance your internal view with an objective and un-biased assessment (i.e. Market trends and global customer assessment).  

The combination of both data sources will enable you to assess your customers‘ credit worthiness in a holistic way. In SAP Credit Management (CM), you can use a scorecard to flexibly define the parameters that are to be considered. 

In addition to the scorecard, SAP Credit Management also supports automated credit decisions. This will cover review and release of blocked orders via Documented Credit Decision as well as review and approval of credit limit requests (raised by various departments). In addition, SAP CM further supports process automation via eventing processes (i.e. External rating is changed and this will trigger a recalculation of score and limit) as well as workflows.

Here are the 5 use cases the app supports:

  1. Search / lookup of business partners

    • Business partner name, address attributes, etc., are sent to the credit agency

    • The credit agency returns a hit list with business partners that fit the search criteria, including the business partners’ unique identifiers

    • The user selects ”the right” business partner, the respective unique identifier is updated in SAP Credit Management

        2. Get credit report of a business partner (see also click-through slides in APPENDIX)

    • The business partner’s unique identifier, product code and reason code are sent to the credit agency 

    • The credit agency returns the requested credit report for the business partner, including rating, proposed credit limit, etc.

    • The credit report is stored in the app and data like rating, legal form, foundation date and industry code is updated in SAP Credit Management 

        3. Manage business partner monitoring

    • Register a business partner for monitoring updates

    • Stop monitoring updates for a business partner

        4. Process monitoring updates

    • The credit agency sends update for business partner who are registered for monitoring, usually with a reason code (what has changed?), changed values (old & new) or a full new credit report

    • Data need to be updated in SAP Credit Management if necessary

        5. Trigger investigation / research request (FUTURE)

    • A business partner requested during the search is not found in the database of the credit agency

    • An investigation / research request can be filed in order to trigger further investigations (offline) by the credit agency

With 18 years of experience and located just 2 hours from the Texas border, we offer high quality Nearshore AMS Services for the US market.

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SAP Nearshore Services for the Financial and Banking Industry