What is 'add-on amount' in SAP FS-BA-PM-CR - Credit Risk?

add-on amount - Overview

• Component: FS-BA-PM-CR

• Component Name: Credit Risk

• Description: Risk mark-up that takes into account the default risk arising from transactions with a market value that could increase within a particular period of time. The add-on amount is calculated by multiplying the assessment basis by an add-on-factor. The add-on amount, coverage expense and the current market value together form the credit equivalent amount.

add-on amount - Details

• 
  Key Concepts: 
  Add-on amount is a feature of the Credit Risk Management component of SAP FS-BA-PM-CR. It is used to calculate the total amount of credit that a customer can receive from a company. The add-on amount is calculated by adding the customer's current credit limit to the amount of additional credit requested. 
  
  How to use it: 
  The add-on amount feature can be used to determine the total amount of credit that a customer can receive from a company. To use this feature, enter the customer's current credit limit and the additional credit requested into the Credit Risk Management component of SAP FS-BA-PM-CR. The system will then calculate the total amount of credit that the customer can receive. 
  
  Tips & Tricks: 
  When using the add-on amount feature, it is important to remember that the total amount of credit that a customer can receive is limited by their current credit limit. Therefore, it is important to ensure that the customer's current credit limit is up to date before calculating the add-on amount. 
  
  Related Information: 
  For more information about the Credit Risk Management component of SAP FS-BA-PM-CR, please refer to the official SAP documentation. Additionally, there are many online resources available that provide detailed tutorials and tips on how to use this component.