What is overdraft in SAP FS-CMS - Collateral Management System?

SAP Term: overdraft

• Component: FS-CMS

• Component Name: Collateral Management System

• Description: The drawdown of a receivable beyond the limit agreed between credit giver and the borrower.

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• Key Concepts: 
  An overdraft is a type of loan that allows a customer to withdraw more money from their account than they have available. In the context of SAP's FS-CMS Collateral Management System, an overdraft is a loan that is secured by collateral, such as real estate or other assets. The collateral is used to guarantee the loan and protect the lender from losses in the event of default. 
  
  How to use it: 
  In SAP's FS-CMS Collateral Management System, an overdraft can be used to provide additional liquidity to a customer. The system allows customers to set up an overdraft limit, which is the maximum amount of money they can borrow. The system also allows customers to monitor their overdraft balance and make payments on the loan. 
  
  Tips & Tricks: 
  When setting up an overdraft in SAP's FS-CMS Collateral Management System, it is important to ensure that the collateral is sufficient to cover the loan amount. It is also important to ensure that the customer has sufficient funds in their account to cover any interest payments on the loan. 
  
  Related Information: 
  SAP's FS-CMS Collateral Management System also provides other features such as loan origination, loan servicing, and risk management. For more information about these features, please refer to SAP's documentation or contact your local SAP representative.