What is guarantee rate in SAP FS-CMS - Collateral Management System?

SAP Term: guarantee rate

• Component: FS-CMS

• Component Name: Collateral Management System

• Description: A pre-defined percentage of the collateralized receivable for which the guarantor signs an agreement with the collateral taker to assume responsibility for paying the liabilities. In the case of indemnity bonds: If the collateral giver's contingent contingent payment obligation for the bank's collateralized transaction is limited to the loss of the bank after liquidation of any remaining collaterals for the collateralized transaction, and this default liability is not only limited to a percentage of the loss but rather is only or also limited to a pre-defined percentage of the collateralized transaction, then this constitutes a restriction on the default liability. &EXAMPLE& Guarantee rate = 80%. Two collaterals are used to secure the receivable: Land charge: 65% of the receivable value 2, a relative or absolute value to be sufficiently collateralized by the land charge. Indemnity bond default Burgschaft: provides cover for the expected loss 35% of the total amoun

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• Key Concepts: 
  The guarantee rate is a feature of the FS-CMS Collateral Management System (CMS) in SAP. It is a percentage that is used to calculate the amount of collateral that must be provided by a customer in order to secure a loan. The guarantee rate is determined by the lender and is based on the risk associated with the loan. 
  
  How to use it: 
  The guarantee rate is used to calculate the amount of collateral that must be provided by a customer in order to secure a loan. The guarantee rate is determined by the lender and is based on the risk associated with the loan. The CMS will then calculate the amount of collateral required based on the guarantee rate and other factors such as the loan amount, interest rate, and repayment period. 
  
  Tips & Tricks: 
  When setting up a loan in SAP, it is important to ensure that the correct guarantee rate is set. This will ensure that the correct amount of collateral is calculated and that the customer does not have to provide more collateral than necessary. 
  
  Related Information: 
  The guarantee rate is just one of many features of SAP's FS-CMS Collateral Management System. Other features include credit scoring, automated collateral management, and automated reporting.