Question

Why does a business banker consider the total customer-bank relationship when pricing a loan?

Answer 1

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Ans: While pricing a business loan business banker consider the customer-bank relationship because

1. To retain valued customer.

2. To examine his potential to pay off the loan.

3. It also gives a sense of loyalty of a customer towards bank and in that scenario bank can offer better rate of interest too.

4. A customer character and behavior bank understands in day to day dealing and this is how pricing of loan become easier.

5. Bank can access the transaction history and understand customer’s business turnover.

6. It is also easier to understand customer’s intension to payback loan.