The use of points recording method to reduce credit risks of non-performed personal loans Abbas Hashim Muhalhal, Mazin Abbas Kadhim, Hatam Kareem Ashoor

الملخص EN

Non-performed loans is a serious risk faced by loan granting banks as it leads to freezing part of the banks' money for the inability of borrowers to pay back.

That exposes the bank to loss, especially, when there are no sufficient financial warranties that may be used to repay the loan.

The long time for administrative and legal disputes may also cause the bank to loose efforts, time, and alternative investment opportunities.

Thus, the present study aims at clarifying the concept of credit and its risks, the significance of adopting modern methods like the one used in the present study, to reduce the risks of granting credit for non-performed loans, and to preserve the rights of the banks.

The present study is based on a major hypothesis which assumes that using points recording method reduces the risks of credit granting as well as the costs of non-performed debts.

That enhances taking lending decisions according to modern scientific principles.

The present study emphasizes the importance of points recording method before lending to protect the banks from loss of time and efforts which may result from administrative and legal disputes between the bank and the borrower.

The present study recommends using modern methods to reduce the risks of credit granting and its coasts.