What is extended retention of title in SAP FS-CMS - Collateral Management System?

SAP Term: extended retention of title

• Component: FS-CMS

• Component Name: Collateral Management System

• Description: An agreement on the retention of title according to which the supplier authorizes the buyer to sell the goods in the supplier's own name, with an agreement on the advance assignment of the receivable resulting from the sale.

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• Key Concepts: 
  Extended retention of title is a feature of the FS-CMS Collateral Management System (CMS) that allows a lender to retain ownership of collateral until all contractual obligations have been met. This feature allows lenders to protect their interests in the event of a borrower defaulting on their loan. 
  
  How to use it: 
  In order to use extended retention of title, lenders must first register the collateral with the CMS. Once registered, the lender can then set up an extended retention of title agreement with the borrower. This agreement will specify the terms and conditions under which the lender will retain ownership of the collateral until all contractual obligations have been met. 
  
  Tips & Tricks: 
  When setting up an extended retention of title agreement, it is important to ensure that all terms and conditions are clearly outlined and agreed upon by both parties. Additionally, lenders should ensure that they have adequate insurance coverage in place in case of a borrower defaulting on their loan. 
  
  Related Information: 
  The FS-CMS Collateral Management System also offers other features such as automatic collateral valuation, automated collateral monitoring, and automated collateral liquidation. Additionally, lenders can use the system to track and manage their collateral portfolio.