What does a Credit Analyst do?

what does a credit analyst do

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A credit analyst reviews the financial picture of an individual or business to determine what the level of risk is when lending money. They may also help determine if the amount the individual or business requests can be reduced to become a less risky loan. They often work on the computer and use software programs to help analyze and calculate the data. Watch a video to learn what a credit analyst does.

How to Become a Credit Analyst

Most often, people become a credit analyst with a bachelor’s degree. However, a bachelor’s degree is not mandatory and it is just up to an employer’s preference. According to O*NET OnLine, most analysts earn a bachelor’s degree and some have earned an associate’s degree. Credit analysts also learn on-the-job, so degrees in business and finance can help you land a job.

Job Description of a Credit Analyst

what does a credit analyst do

A credit analyst reviews an individual or businesses finances to determine how much risk is involved if money is lent. Additionally, they use software programs that generate financial reports to help evaluate a client’s financial status. Some of the financial information analysts use includes credit history, income, and financial comparisons in geographic areas. Finally, they draft reports that indicate the level of risk involved to inform any interested parties.

There are also several benefits to being to being a credit analyst. For example, they have the opportunity to work from home depending on their employer. They may also enjoy competitive salaries and benefits. Finally, these professionals can create a pathway to work in other careers in finance should they so choose.

Credit Analyst Career Video Transcript

If you or someone in your family uses a credit card, a decision had to be made about whether you could be trusted to pay back the money you charge. That decision depends on the work of a credit analyst. A credit analyst examines the financial statements and credit history of individuals or companies. Based on that information, the analyst determines the degree of risk involved in extending credit, or lending money.

Credit analysts often work for banks and other financial institutions, though any corporation that extends credit might employ one or more. For example, manufacturing concerns might run credit checks on customers before starting to make products, to make sure that customer has a history of paying on time. It’s a job that requires careful consideration of information, and the ability to prepare a clear, objective report. The decisions must be made on facts, not instinct, so a credit analyst must be able to focus on details, hour after hour, and day after day.

The working conditions are usually very comfortable with an office and a standard 40-hour workweek the norm. A bachelor’s degree is the most common source of training. College graduates with business related degrees can move easily into these positions, but it can be a position for which training is available on the job. A key part of the nation’s economy runs smoothly when this job is done well. Without credit, in fact, much of the economy would grind to a halt. Houses wouldn’t be built, tuitions wouldn’t be paid, cars wouldn’t be bought, the list goes on and on. To continue the flow of credit, analysts consider whether it’s safe to loan the money, case by case.

Article Citations

Bureau of Labor Statistics, U.S. Department of Labor, Occupational Outlook Handbook, Credit Analysts.

National Center for O*NET Development. 13-2041.00. O*NET OnLine.

The career video is in the public domain from the U. S. Department of Labor, Employment and Training Administration.

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