What is 'valuation method' in SAP FS-BA-PM-CR - Credit Risk?

valuation method - Overview

• Component: FS-BA-PM-CR

• Component Name: Credit Risk

• Description: Specifies which method is used to value derivatives. The following methods are available: Maturity method Market valuation method

valuation method - Details

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  Key Concepts: 
  Valuation method is a component of the Credit Risk Management module in SAP. It is used to determine the value of a customer’s credit risk. This value is then used to determine the amount of credit that can be extended to the customer. The valuation method takes into account factors such as the customer’s credit history, financial stability, and other relevant information. 
  
  How to use it: 
  The valuation method is used to calculate the credit risk of a customer. This calculation is based on the customer’s credit history, financial stability, and other relevant information. The result of this calculation is then used to determine the amount of credit that can be extended to the customer. 
  
  Tips & Tricks: 
  When using the valuation method, it is important to ensure that all relevant information is taken into account. This includes not only the customer’s credit history and financial stability, but also any other factors that may affect their ability to pay back the loan. 
  
  Related Information: 
  The Credit Risk Management module in SAP also includes other components such as Credit Limit Management and Credit Exposure Management. These components are used to manage and monitor a customer’s credit risk over time.