Introduction to Line Of Credit

Letter Of Credit (LOC), is an arrangement between a financial institution and a customer that establishes a maximum loan balance that the lender permits the borrower to access or maintain. The borrower can access funds from the line of credit at any time and can make timely minimum payments.

In Canada, LOC is a general lending product offered. The line of credit functions as a revolving loan amount with a pre-approved limit attached to a demand account with unsecured or secured by an asset. The funds available in the line of credit account can be withdrawn at any time during the life cycle and repaid partly or fully any time.

This document is addressed to FI who have migrated from the R13 release to the R17 or to releases above and have to run the LOC correction and provide the LOC correction procedure to run the correction service.

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