The Study About The Decision Making Model Of Client’s Credit Limits And Its Application

Due to the impact of the world economic crisis, China’s economic development faces a huge challenge. Expanding domestic demand, promoting consumption, maintaining steady and rapid economic development have become the primary tasks of macroeconomic regulation and control in our country. Five ministries and commissions jointly proposed to take credit sales as an important way to expand domestic demand to ensure economy growth. In the post-economic crisis era, credit sales as the main way of modern sales, has been adopted by more and more enterprises. Along with the expansion of the scale of credit sales, default payment for goods appears among different companies. A lot of overdue receivables, doubtful debts and bad debts have become important problems in economic operation. Therefore, how to make the decision of credit sales to make reasonable customer credit limits, and to strengthen the management of the credit line has become the top priority problem of the business credit management.This article is standing on the credit business aspect. When analyzing customer credit sales transactions, mainly based on the client’s financial situation and the customer’s repayment ability. And then we make the conclusion in qualitative and quantitative method. At present, the existing customer credit calculation methods include the sales volume method, amount back and operating assets analysis method, and then we evaluate customer credit limits by feature analysis model even to correct customer credit limits. This article determines the proportion of customers working capital by introducing Wall proportion scoring method and improved it. Finally, customer working capital multiplied by the corresponding proportion we can determine customer credit limits, and we use this data to analysis one case.This article is divided by five chapters. The first chapter introduces the research background, purpose, meaning, content, and innovative content about customer credit decision-making, such as building customer credit limits model which is remaining characteristics of the industry on the basis of working capital. The second chapter introduces the concepts, theories and models related to customer credit, such as credit sales, credit risk and the credit limit concept, the influencing factors of customer credit, and the existing calculation method of customer credit. This has laid a theoretical foundation for the further study. The third chapter gets customer credit limits using customer working capital multiplied by the corresponding proportion and this is on the basis of the ideas of operating assets analysis model. In this chapter we use improved Wall proportion scoring method to determine the proportion of customer working capital. The fourth chapter researches customer credit applications based on information technology and takes these companies including Neusoft Group, Teamsun and Huiyuan as typical cases to study. The fifth chapter includes a summary of the full text conclusions and weaknesses of this article.