Who are Credit Analysts?
Credit analysts are professionals who are assigned the job of analyzing and concluding the creditworthiness of various customers and businesses. Most of their job includes examining the applications of credit and deciding if a particular person is worthy of the lenders' money and can pay them back with other costs. The credit analysts also evaluate various risks associated with the credit element of the business.
Credit analysts also forecast and project future revenue streams and revenue from various fields. They also analyze various financial information like income and expense statements, profit and loss statements, cash flow statements, etc. One of the most important jobs of a credit analyst is to ascertain the creditworthiness of a person based on his or her salary or business income and then assign him a credit limit i.e. how much credit can a person take at a given time.
Credit analysts also decide on the rate of interest to be paid by the borrower on the amount of loan taken by him frequently. Credit analysts also conduct credit reviews of the current customer base and also resolve any credit-related issues their customers face. Risk analysis and trend pattern tracking are also very important functions of a credit analyst.
To become a credit analyst, one must have a bachelor's degree in finance, business, economics or any other similar field. Some companies demand certification from specialized credit management institutes. The job of a credit analyst is laden with huge responsibilities and cannot be avoided.
Credit analysts can work for various commercial and investment banks, credit rating agencies like Standard and Poor, CRISIL, Moody’s, etc., companies that issue credit cards like American Express, Ru pay, VISA, etc. They also have to perform various quantitative analyses like ratio calculations, calculating the net worth of various assets, analyzing the industry by numbers, risk assessments and how these risks would affect the financial appetite of the company, etc.
The scope for a credit analyst is quite broad. All companies can have a credit analyst depending upon how volatile and dynamic the company is. It is a lucrative job for people who have a knack towards finance and want to make a career out of it.
How Much Do These Credit Analysts Make?
The salary of a credit analyst primarily depends on the sector they are working in. If they work for various commercial banks, they get decent pay but if they are working for an investment bank, chances/re that they are highly paid. Also, it depends from candidate to candidate and what skills and expertise he brings to the table.
The average salary of credit analysts ranges from somewhere between 72,000 USD to 132,000 USD depending on the institutions they are working for. In India, the average pay of any credit analyst is somewhere around 6.5 to 7 lakhs with companies like the State Bank of India paying them around 11 to 12 Lakh rupees annually. The role offers a lucrative salary and abundant growth opportunities. Once you become a credit analyst, you can be promoted to the role of Senior Credit Analyst with much higher pay than before. Commercial Banks like HSBC and Standard Chartered pay their credit analysts somewhere around 9 to 10 lakhs INR.
Credit analysts come under one of the highest-paid employees in the banking and finance sector. With a huge scope of professional development and growth, the job is a lucrative deal and has huge things in store. Though a little stressful, a credit analyst's life is full of opportunities and is exposed to several new learnings.