What is free line in SAP FS-BA-PM-CR - Credit Risk?

SAP Term: free line

• Component: FS-BA-PM-CR

• Component Name: Credit Risk

• Description: The part of a facility that is undrawn.

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• Key Concepts: 
  Free line is a feature in the Credit Risk Management (CRM) component of the Financial Services Business Application Platform (FS-BA-PM) of SAP. It allows users to set a limit on the amount of credit that can be extended to a customer without requiring additional approval. This limit is referred to as the “free line”.
  
  How to use it: 
  To use the free line feature, users must first set up a credit limit for each customer. This credit limit is then used to calculate the free line for each customer. The free line is calculated by subtracting the customer’s current outstanding balance from the credit limit. The resulting amount is the free line.
  
  Tips & Tricks: 
  It is important to remember that the free line is not a fixed amount and can change over time depending on the customer’s current outstanding balance. It is also important to note that the free line should not be confused with the credit limit, which is a fixed amount and cannot be changed without additional approval.
  
  Related Information: 
  The free line feature is part of SAP’s Credit Risk Management component, which also includes features such as credit scoring, credit monitoring, and credit reporting. For more information about Credit Risk Management, please refer to SAP’s official documentation.