Who is a Credit Officer?
- The term ‘Credit Officer’ have different meaning in different banks. For example, in many Private banks and NBFCs (Non-Banking Financial Company) Credit Officer means a person who executes the credit (loan) process, e.i. paperwork.
- In some NBFCs, the Credit Officer is responsible for acquiring or finding new customers for loans i.e., a Relationship or Sales Officer.
- When I say Credit Officer, what I mean is someone who does the credit assessment and analysis. In other words, Credit Analyst. The job of a Credit Officer/Analyst is to get all the relevant information from the applicant, verify the authenticity of the information, check whether the given information satisfies the norms of the organisation’s credit policy, and finally do an assessment of the application which includes the applicant and the project. On the basis of his/her assessment, the Officer/Analyst recommends sanction or rejection of the application.
- In some nationalised banks the Credit Officer has to complete the documentation process, if the loan is sanctioned, and monitor the conduct of the loan account. Sometimes, he also have to take actions for recovery when the accounts turn NPA or overdue.
- In some banks, the tasks are delegated under a Credit Head and in others all functions are handled by a single person or a team in which everyone has somewhat similar role. The assessment and analysis is the most important part of the job of a Credit Officer/Analyst, independent of which organisation you are working.
What did you to choose BCA? And why the switch to banking?
I wanted to be a Software Engineer when I was in Higher Secondary. I could not secure admission in any of the top engineering colleges and I could not afford the fees of good private Engineering colleges. So doing BCA was one of the few options I was left with. I never felt that I am not good enough to make it into the Software development field, neither I ever felt any inferiority complex for not doing engineering.
I worked hard and did two internships on my own. Took BCA because I like computer programming and it provided me the opportunity to learn that. During that period I became fascinated with economics and accounts and realised that I have the skills to be a good banker.
In my final year, I was selected for Wipro’s WASE programme. I was very happy and excited to be part of the software industry. But when I started to search about what kind of work I am going to do all my excitement disappeared. I found that most of my work will be similar to what I did during my internships. So after completing my graduation I applied for the IBPS PO exam and got selected for Dena Bank.
What is your job role within the organisation?
Since I work in a nationalised bank, that too at branch level, I have to play multiple roles. I was selected as a Probationary Officer, so I don’t have a specialised role to play but a role of a generalist.
Since most of the nationalised banks have low staff strength and most of loans are either processed or sanctioned at the branches so most of the officers have to take the responsibility of loan processing as well. That way I got the opportunity to work in the loans processing and monitoring which includes the complete assessment, documentation and monitoring of the accounts.
Can you summarize your daily routine?
My typical day starts at 9:30, half an hour before the official time.
- First thing I do is to take report for various loans which are either overdue or are going out of order. In other words, which are going to become non-performing and create trouble for the bank.
- After taking this report, it needs to be handed over to the recovery team who will follow-up with the borrowers. Since there is no recovery team in my branch, I do this.
- Further, I take another report for the NPA accounts and repeat the process (in some organisations the monitoring and recovery parts are handled by different teams).
- After finishing off with monitoring and recovery reports I check the status of the applications which I have forwarded to the sanctioning authorities like the Zonal Office or the Branch Manager.
- If there are any queries or objections, I reply to it with clarification or rectify it. Sometimes I have to communicate the same to the applicant to get the answer.
- If the loan is sanctioned, I call to the applicant(s) and tell them what they need to complete the loan process, which generally means what are the terms and conditions, what are the required documents, who needs to sign, etc.
- Once the status of pending applications is checked and queries are replied, I move on to assessment of the new applications, which includes interviewing the applicants, taking Credit Information Reports, field visits, balance-sheet analysis, rating, etc.
After completing my assessment, I check whether the application satisfies all the conditions of our Loan Policy and RBI’s and other bodies’ regulations or not and is it possible to deviate from some norms? If yes, on what grounds? If the applicant satisfies all the conditions I forward the application with recommendation to the person or department under whose power the authority to sanction the loan lies. Incase some deviation is required I forward the application with the justification for the deviation. If the applicant does not satisfy the conditions, I return the application to the applicant quoting the reason(s) for rejection. After that I proceed to the documentation process where the relevant documents are taken and signed by the applicants. And finally, the disbursements are made to the applicants whose loans are sanctioned and all the documentation is complete.
How can I become a Credit Officer?
Learning through case studies and interacting with very experienced people, mostly bankers helped to me land in present position.
I applied for the post of a Probationary Officer which is different from Credit Officer/Analyst. The process is same for both in nationalised banks but they ask for CA/ICWA or full-time MBA-Finance for Credit Officer as mandatory qualification and graduation in any subject with 60% for Probationary Officer.
So to become a Credit Officer in a nationalised bank you first complete CA/ICWA/MBA-Finance and then apply for IBPS SO (Specialist Officer) exam. The IBPS SO exam is conducted in two parts:
- Online Exam
The online exam consists of four parts:
- Reasoning Aptitude
- Quantitative Aptitude
- Subject knowledge, which in this case will be accounts, finance, banking and related subjects
After passing the online exam you will be called for the interview. After the online exam and interview marks are combined a merit list will be prepared. The candidates in the merit list will be offered the role in different banks.
The process in the private banks is different. They only take CAs as freshers otherwise they ask for some experience in the field of Credit. If you are a qualified CA you can directly apply on their website’s career page and after scrutinising your profile they will call for the interview.
Some private IBA member banks follow the process of nationalised banks but they ask for applications separately.
What do you wish you knew before you started preparing for this career?
I wish I had done CA along with BCA. In that case I would have got specialised.
How is the actual career different from what you initially thought about it?
The most troubling thing I have learned is that in nationalised banks, especially the smaller ones, the level of professionalism is very low. Many people in higher positions are neither professional nor interested in upskilling.
What have been the most surprising elements of this career?
The most surprising element is the interference of the government in the loan operations of the nationalised banks. There are numerous schemes which are for the welfare of the poor people. But, those schemes are used by the state government employees to take bribes and help the wrong kind of people to get all the benefits. This always results in loss for the bank and hence failure of the schemes.
What did you learn about the career after you started your job?
The most important things I have learned after starting my career are as follows:
- There are various fields in which one can work as a Credit Officer/Analyst. As you move forward in your career, you should specialise in a particular field.
- You should be aware about all the latest developments.
- Credit Analysis is very closely related to risk management. Acquiring good level of risk management skills will immensely helpful in your job.
What things would you do differently in preparing for this career?
- Doing a CA along with graduation.
- Following the latest developments in banking, it is good to acquire certifications in Credit and Risk Management and Finance.
What do you love about your current role?
Though pay is above average, the work life is good. The demand for Credit Officers/Analysts will remain high as there are many qualitative aspects which requires sound judgement.
What are the challenges you face in your career?
The long working hours and constant travelling can be daunting, but if you plan well you will not face any major issues.
Can you please summarise your career journey?
- +2 – Science
- Under Graduation – BCA
- July 2015 to current – Joined Dena Bank as PO
- November 2015 – Passed JAIIB
- June 2016 – Passed CAIIB
- September 2016 – Became Certified Credit Officer
- May 2017 – Completed Course in Project Finance
- May 2017 – Passed Certificate in MSME Finance for Bankers
- July 2017 – Passed Certificate in Risk Management
I would recommend a student the following path:
- Take Commerce after 10th(Secondary)
- Focus on Accounts, Economics and Mathematics
- Learn MS Excel and similar software
- Enroll for CA/ICWA
- Enroll for B. Com or B.A. Economics
- After CA apply for IBPS SO and similar exams. If you want to work for private banks apply directly to their website
- If you are unable to complete CA, enroll for MBA-Finance or MA-Economics
- Certified Credit Officer – IIBF (after joining a bank)
- Certificate in MSME Finance – IIBF (after joining a bank)
- CCRA – NISM
- FRM – GARP (needs 2 years of experience; for growth)
- CFA – CFA Institute (for growth)
- CITF – LIBF (for specialisation in Trade Finance)
- CDCS – LIBF (for specialisation in Trade Finance)
- CSDG – LIBF (for specialisation in Trade Finance)
What sort of experiences helped prepare you most?
- Since I took Science stream in +2, I am good at the quantitative part of Credit Analysis.
- Programming and software development requires you to be good at logical reasoning, which helps you in understanding the logical flow of a process which is useful when appraising a business loan and big projects.
- Completing the Certified Credit Officer programme helped a lot in understanding different aspects of Credit Appraisal.
- The second part of it is a class-room assessment where you have to demonstrate the skills in front of the assessors. During this assessment I got opportunity to interact with a lot of senior professionals which helped me to understand the best practices and approaches of Credit Appraisal.
- I did BCA because I like computer programming and it provided me the opportunity to learn that.
How do you like to spend your free time?
Mostly reading. I feel that a person should keep on learning as much possible and try to pass on to others. Reading on subjects related to your work, society and the international affairs gives you a perspective about the events which directly or indirectly affects you and helps you evolve into a better professional and human being. Other than reading, I listen to classical music, Anoushka Shankar and Beethoven, mostly.
What are the skills and education required to be a Credit Officer?
- Post-graduate Diploma from NIBM, Pune comes to the mind. But CA would be the best.
- Communication skills are as important as quantitative skills.
- Diligence – 100%
- Communication – 60-75%
- Quantitative – 25%-40%
For being successful in the career you should be very diligent at all the stages of the credit process. You should constantly keep yourself updated about the latest developments and policy changes, certifications help in this regard. You should have a very strong oral and written communication as any ambiguity can result in sanction of wrong loan or misinterpretation of terms and conditions.
What are some alternate career options for a Credit Officer?
- Risk Manager
- Compliance Professional
- Loan Advisor (industry is at nascent stage)
- Insurance Professional (not to be confused with agent)
- Forensic Auditor (Frauditor)
What do you think potential recruiters look for in a fresh Credit Officer?
- Accounting knowledge
- Strong quantitative skills
- Strong communication skills
- Willingness to learn
- Being aware of the policies, regulations and latest development
Who do you think should take up this Career choice?
You should be a CA or CMA or MBA-Finance. B. Sc. (Agriculture) can also be helpful if you join a nationalised bank.
You should opt for this field only if you:
- are good at mathematics and accounts
- have or can develop good communication skills
- pay attention to details
- are willing to keep yourself updated about various policies, regulations, latest developments, changes in policies and regulations.
Any recommended resources for aspiring Credit Officers?
What do you think everyone leaving higher secondary school should know?
Whatever skills you acquire in next 3-5 years are what going to make or break your career, make it count.
Spend this time wisely by doing relevant certifications and internships (even if you are an Arts student, there is no substitute for learning on the job). Try to be and appear professional even if your friends make fun of you, it will be worth it. Develop strong communication skills.
For banking aspirants: Enrol for CA/ICWA. Develop strong quantitative skills. Keep yourself updated about all the policy changes and regulations. It is an ever changing world. Be aware of everything. The job will be tough. Take decisions only after taking all the factors into account.
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