Banks and enterprises use the CAMPARI method to analyze credit risk and verify the creditworthiness and solvency of customers. The term CAMPARI is an acronym for key terms such as Character, Ability, Means, Purpose, Amount, Repayment, and Insurance.
Hand in hand with the CAMPARI method is the abbreviation ICE, which means benefits for the institution granting the loan. ICE stands for Interest, Commissions, or Extras such as insurance or legal fees.
Character
Character relates to the ethics and honesty of the business and its management. Granting a trade credit carries a risk, so the willingness to present the necessary documentation is of great importance for the controller. Demonstration of good commercial and financial standing supports the decisions of a corporation or bank.
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