What is collateral monitoring in SAP FS-CMS - Collateral Management System?

SAP Term: collateral monitoring

• Component: FS-CMS

• Component Name: Collateral Management System

• Description: The regular monitoring of the collaterals pledged by the customer to detect any changes to their values or validity periods. The collateral monitoring process also includes system checks and formal and legal checks.

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• Key Concepts: 
  Collateral monitoring is a process used to manage and monitor the collateral that is used to secure a loan or other financial transaction. It involves tracking the value of the collateral, ensuring that it is sufficient to cover the loan, and taking action if it falls below the required level. The FS-CMS Collateral Management System (CMS) is a software solution from SAP that helps organizations manage their collateral monitoring processes. 
  
  How to use it: 
  The FS-CMS CMS provides a comprehensive set of tools for managing collateral monitoring processes. It allows users to track the value of their collateral, set up alerts for when the value falls below a certain level, and take action to ensure that the collateral remains sufficient to cover the loan. The system also provides reporting capabilities, allowing users to generate reports on their collateral monitoring activities. 
  
  Tips & Tricks: 
  When setting up alerts for when the value of collateral falls below a certain level, it is important to set realistic thresholds that will trigger an alert without being too restrictive. Additionally, it is important to ensure that all relevant stakeholders are aware of the alerts and have access to the system so they can take appropriate action when needed. 
  
  Related Information: 
  The FS-CMS CMS is part of SAP’s Financial Services suite of products, which also includes solutions for banking, insurance, and asset management. Additionally, SAP offers a range of services and support options for customers using its products.