FI Question LP-Limit Breaches

Do you have limit breaches which are caused by your lack of ability to reserve or block a credit line for a potential transaction?

limit breaches

“Yes, we try to earmark limits upfront in an Excel tool when we know that a transaction i.e., a SWIFT confirmation for an LC will come. But often the actual deal terms are different or there is a mismatch with our manual record, or in some cases, there is no reservation at all, and then we must explain this breach to the credit committee and rectify it manually.”


– Head of FI, Wholesale Branch of a Tier1 Bank


How RISQ solves it:


At RISQ, the booking division (e.g. trade finance department) can block or reserve the credit line for a specific transaction. Once the real transaction takes place, RISQ will make sure the actual exposure matches the reservation request, otherwise it will flag it as a breach. If no transaction takes place, the reservation will be automatically deleted after expiry.

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