SAP Credit management: Functional overview
In this blog we will make a brief summary of the most important points about SAP Credit Management
First, the difference between “FI-AR Credit Management” and SAP Credit Management is detailed
SAP Credit Management takes information in real time from the SD and FI modules. Allowing a credit analysis on the flight and gives us the certainty of an accurate analysis of the clients
Frequently asked questions we ask about Credit Management:
What allows to create SAP Credit Management ?
Credit Limit Management
– Implement a company wide credit policy
– Manage a customer credit profile
– Central credit management in a distributed system landscape
– Credit case for structured processing of credit limit applications
– Track status and result of credit limit applications
Credit Rules Engine
– Categorize customers by scoring rules
– Automatically calculate and assign a customer-specific credit limit
– Credit check rules
– Model and implement own customer credit score cards
– Interface to external credit agencies
– Input parameters for scoring rules
Credit Manager Analytics
– Role-based access to credit management information and analysis
What allows Credit Rules Engine?
- Create a scoring formula and credit limit formula by using the formula editor. Parameters (for example, business partner data) and functions are used as input parameters.
- One scoring formula and several credit limit formulas (for each credit segment) are assigned to the rule for scoring and credit limit calculation, which is assigned to each customer in the credit profile. The risk class is determined directly from the score.
- In customizing, specific score ranges which do not overlap are assigned to each risk class. For the check rule, the system determines the steps which are taken to check the creditworthiness of a customer when a sales order is created. This may include the static check of the credit limit or acheck of the highest dunning level.
- Customer-specific process chains in SAP Credit Management can be defined through events which trigger follow-up actions
Calculate internal credit scoring
In the scoring you can combine customer master data and transactional data (e.g. payment behavior) to score a customer.The scoring is based on formula that can be freely defined by the user.
In the scoring method you can include ratings from external sources. Multiple external ratings can be mapped to an internal rating to make them compareable
Use a black-rated customer list to prevent business with high risk customers
Example credit management process:
– A sales order that is entered in the sales system can be checked automatically in the credit management system.
– If the check fails, the order is blocked and the credit manager can review the customer credit profile.
– He can request credit report from an external source. (e.g. D&B)
– Based on new external information the scoring and a new proposal for credit-limit can be automatically calculated by the system
Based on the new credit limit the credit manager can release the sales order now
Credit Management with Central Payments
You can also use SAP Credit Management with Central Payments in Central Finance
For this scenario it is necessary to implement SLT and through IDoc / ALE, etc. You can send the SD module information from the source system to the target system.
Nice overview. Could you please share more detail on "it is necessary to implement SLT and through IDoc / ALE, etc." Do you mean the document replication or credit check service message flow from source to target.
Also, the scenario should work if the document status in both source and target system reflecting the right status.
Thank you!. It is not necessary to implement SLT for the Credit Management module, the communication is by IDOC.
The credit check begins when the sales order is generated in the source system.
Yes, it is correct the system works correctly when the data have the same status in both systems.
Thanks for very informative blog. We are trying to setup SAP Credit Management with existing Central finance & central payment landscape. But We did not get any information of landscape and SLT tables for replication in SAP help document for this senario. would it be possible to provide the link to standard documentation.
Thank you for a good overview of the functionality, is there any detailed documentation we can refer for settings we need to change on existing ECC systems for deactivating existing credit check functionality and in case we have multiple ECC systems, We are linking them all to CFIN but only want to do use centralized credit check only on some of them and have the credit check activated selectively on few ECC instances. any insight on this scenario will be very helpful.
Did you find any document on deactivating credit check in ECC? We are in a similar situation.
Can you please provide what steps you have undertaken? aluruvk@hotmail
Dear Pablo or Mehul,
Did you find this documentation that can clarify how to activate the credit check only for some of the source system or even just some of the legal entities? We are encountering this scenario where we do not want to do a centralized credit check for all legal entities.
Appreciate any support!
Great article and very informative.
Want to ask if you have implemented Credit Management in distributed landscape? Have a client who is implementing cFin and has few source systems.
What are some of the configuational tasks? How do you make source systems talk to credit mgmt enabled system? Some key considerations and etc.
Thank you for sharing..
SAP has a separate license for Advanced Credit management iwth CFIN. Without that extra license, can we still leverage the SAP Credit Management BADI for updating credit exposures in S/4?
I´m sorry, No ...Because If you need use the SAP Credit Management BADI, you need the license for SAP Credit Management
Thank you for your response. What are the configuration node that we can touch without the Advanced Credit Management. Can we still configure the FSCM Credit Management at least?