Recovery of loans

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In financing, the term recovery refers to the collection of the amount due. Usually recovery depends on the destination, time and conditions, running business processes, etc.

Usually the loan amount will be recovered based on the installment. Managers can set an installment period based on the nature of their business.

Example:

1. Repair installments on people who are paid every month.
2. In the agricultural sector, installment repairs are made twice a year.
3. Business people are usually 1 year per installment.

Recovery is different from one loan to another.

• In the short term loan recovery is less than 36 months.
• In the medium term loan recovery is from 36 months to 84 months.
• In the long term recovery of the loan is usually 84 months or longer.

The payment period may be extended according to the STC's actions in exceptional cases, usually the bank recover the loan amount from the customer, it easily does not give them any trouble.

The interest earned is income for the company, this should be payment, all costs and re-plowing therefore, the recovery of money is one of the main sources of funds for the company. The health of the corporation is judged by the level of recovery that may affect. All funding sources bring costs, if borrowing costs are higher, reduce margin profit, then earnings are subject to income tax payment in accordance with applicable law. The corporation is also bound by a minimum dividend obligation regardless of whether it generates profit or not from the postal tax and dividend income. The memo is stored in the company by way of backup. Emerging funds into the system emerges as one of the most important sources of funds in the total mix of resources, if the company must have enough money for business operations; it must generate more income. Clearer earnings improve recovery. Therefore, a systematic follow-up of the loans plays an important role in our operations. In fact, it is no exaggeration that an effective loan recovery is the backbone of any financial institution.

Source of the article : Wikipedia