Market Watch

Capital Market Credit Automation

Overview to Capital Market 

The financial market where shares are bought, and investments are funneled between suppliers of capital, including retail investors or institutional investors, as well as users of capital, is known as capital market credit automation

Role: A well-developed, active, and thriving capital market may significantly contribute to the acceleration of economic growth and development. The absence of a sophisticated and dynamic capital market may result in the underutilization of available financial assets. The established capital market also offers access to foreign money for local industry, which benefits both parties. This means that it certainly contributes to the general growth of an economy in a positive way!

Liquidity in the Capital Market 

Liquidity is defined as the efficiency or convenience with which a commodity or security may be converted into available cash without impacting the asset or security’s market value. Cash alone is the most liquid of all financial assets.

 According to market liquidity analysis, a market is defined as the degree to which assets can be purchased and sold at steady and transparent prices.

The Significance of the Capital Market

Mobilizing idle money from the economy via the capital market is a significant source of revenue for the government. 

  • It raises money from the public to make further investments inside the productive channels. 
  • Capital growth is the net extension of the current level of capital in an economy. 
  • It activates the optimal monetary resources and contributes to capital
  •  creation.

This contributes to the increase in corporate credit syndication.

As a result, it offers an investment opportunity for those who want to put their money into something for a lengthy period. It also offers investors a reasonable rate of return on their investments. The capital market contributes to the expansion of output and productivity in the national economy. 

As a result of its ability to make money accessible for a lengthy period, the capital market can meet the financial needs of businesses. It is beneficial in the field of research and development. This contributes to the increase in output and productivity in the economy via creating jobs and infrastructural development.

Liquidity Analysis

The liquidity ratio study of a company is useful in determining the short-term solvency of the organisation. As a result, liquidity refers to the speed with which a company’s assets are turned into cash. Furthermore, it guarantees that a company’s cash flow is uninterrupted to fulfill its existing debt obligations. Liquidity also indicates that a firm has enough cash on hand to fulfill the demands of its day-to-day business activities.

The Advantages of Credit Automation

Automation is a popular term in the financial services sector these days, and for a good reason. How does it benefit your company, and how far can you push the boundaries of automation in your credit stage in the development?

Advantages of incorporating credit automation:

  1. Reduce the number of back-and-forth customer contacts.

Financial information and accompanying documents may be captured digitally via customer-facing dynamic portals and APIs rather than being scanned, emailed, or faxed.

  1. Eliminate manual labor that isn’t required.

With the help of a gateway that links to the borrower’s financial accounting package and is equipped with the ability to read tax forms virtually, you may minimise the amount of time spent manually entering data.

  1. Make choices more quickly and intelligently.

Using cutting-edge machine-learning techniques, it is possible to decrease the time needed to produce financial spreads substantially.

  1. Ensure that high-quality correct data and governance are maintained.

Data integrity may be compromised if several platforms are utilised to store the same piece of information. A turn-key connection between your customer interaction portal and loan system allows you to store all your data in a centralised location.

  1. Obtain a comprehensive understanding of the portfolio.

Improved accuracy and rapid access to accessible data result in better and quicker insights into your portfolio because of these improvements. Reduced reliance on data consolidation and reconciliation from various sources allows you to handle portfolio issues in real-time by eliminating the requirement to combine and reconcile data across multiple sources.


Overall, the Capital market is a wide collection of institutions that engage with the buyers and sellers of all assets, including debt and equity. It is the marketplace where businesses go to obtain capital and fund their ongoing operations. Its liquidity relates to the speed and ease with which it moves and the ease with which it may purchase and sell assets. In a nutshell, liquidity refers to the amount of money that is available for trading. A very liquid market is characterised by fast movement and a large volume of trade.