VAE 511: Livestock Entrepreneurship (1+0)

3 C's OF CREDIT

• They are character, capacity and capital.
• Character implies the borrower’s moral qualities, such as honesty, integrity and sense of responsibility which all influence the risk bearing ability and repayment.
• Capacity signifies the potential of the borrower to repay the loan, when it is due and depends upon his income.
• Capital reflects the net worth of the borrower (assets minus liabilities) which also reflects his repayment and risk bearing ability.