centralized credit management and decentralized credit management

[Former Member]

can anybody littele brief abt the centralized credit management and decentralized credit management with some business processes.

[Former Member]

centralized credit management -one credit control area is assigned to one company codes.

decentralized credit management-one credit control area is assigned to many company codes

Nithin.

[Former Member]

Hi santosh,

Centralised credit management is nothing but a single credit control area, which is taking care of all the customers belonging to the different company codes. For this a single credit control area is assigned to the multiple company codes. Due to this, the customer's credit limit is defined across all the company codes.

Whereas in the decentralised process, each company code have its own credit control area. each credit control area have its own customers and individual credit limits (have its own control settings). Because of this, customers credit limit is maintained seperately for each credit control area.

This is the difference between those two..

Hope u understand...

Reward points if useful...

[former_member204513]

Dear Santhosh,

1. Centralized credit management means the company may have more than one company code but Credit controlling area is maintaining only one for all company codes.Based on that Credit control area the credit management will takes place.

2. Decentralized credit management means the company may have different company codes and each company code will have individual Credit controlining area.

Here we can have defferent credit control areas

I hope it will make you clear,

Regards

Murali.

[Former Member]

Hi Santhosh,

It is a simple easy to understand..

Assume there is a 3 companies in one client for Ex: Reliance is a client and companies are communication ( A ), petroleam

( B ) and investment ( C )..

1 customer like 200221 is the customer for all 3 companies in A, B, and C..

Now, if you want to maintain credit limit centrally that means if place order in A ,B or C system will consider central limit i.e

1 Lacs is the central limit he place order in A 30K in B 40K now he can able use remaining 30K only he can't use more then that if it is decentralised then they can maintain credit limit to the cutomer individully depends upon the bussines given by the cutomer, if place the order in A also it will not effect to B and C .

I hope u understand, Basicallu they will maintain Credit control area Centralised or Decentralized manner..

Rewards if it is useful

regards

Durga Prasad

[Former Member]

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