The Contribution of Credit Policies On the Level of Loan Recovery. A Case Study of City Oil Kampala Branch.

TABLE OF CONTENTS

Declaration .......................................................................................... i

Approval. ............................................................................................ ii

Dedication ......................................................................................... .iii

Acknovvledgen1ent. ............................................................................... .iv

Table of contents ................................................................................... v

Chapter one

1.0 Background ....................................................................................... 1

1.1 Statement of the problem ........................................................................ 2

1.2 Purpose of the study ............................................................................. 2

1.3 Objective of the study .......................................................................... .2

1.4 Research questions ............................................................................... 2

1.5.0 Scope of the study ............................................................................. 3

1.5.1 Geographical Scope ........................................................................... 3

1.6 Significance of the study ....................................................................... 3

Chapter two

2.0 Literature review ................................................................................. 4

2.1 credit policy ....................................................................................... 4

2.1.1 Credit standards ............................................................................... 4

2.1.2 Debtors control systems ...................................................................... .4

2.1.3 Monitoring book debts ....................................................................... 6

2.2 Credit 111anagement. ............................................................................. 6

2.2.1 Goals of credit policy ......................................................................... 6

2.2.2Costs of credit .................................................................................. 6

2.2.3 Credit extension model. ....................................................................... 7

2.3 credit tern1s ....................................................................................... 7

2.4 Collection efforts ................................................................................ 8

2.5 Factoring of debts ............................................................................... 8

2.6 Conclusion ........................................................................................ 9

Chapter three

3.0 Methodology ...................................................................................... 10

3 .1 Study design ..................................................................................... 1 O

3 .2 Study variables .................................................................................. 1 O

3.3 Study population ................................................................................ 10

3.4 Sample design ................................................................................... 1 O

3.5.1 Simple Random Sampling ................................................................... 10

3.5.2 Purpose of sampling .......................................................................... 10

3.5.3 Stratified Sampling ........................................................................... 11

3.6 Sa1nple size ...................................................................................... 11

3. 7 Investigating procedures ....................................................................... 11

3.8 Data collection methods and research instruments ......................................... 11

3 .8.1 Data collection instruments .................................................................. 11

3. 9 Data presentation and analysis ................................................................ 12

V

3 .10 Limitations of the study ..................................................................... 12

3 .1.1 Ti1ne constraint ............................................................................... 12

3.1.2 Financial constraints ......................................................................... 12

3 .1.3 Attitude of the respondents ................................................................. 12

Appendices ........................................................................................ 13

Questionnaire ...................................................................................... 14

Chapter four

4.1 Introduction .................................................................................. 17

4.1.1 Credit standards analysis ................................................................. 17

4.2 Nature and characteristics of customers ................................................... 17

4.3 Credit policy ................................................................................... 18

4.4 Credit Ten11s .................................................................................. 20

4.5 Credit standards .............................................................................. 21

4.6 Collection efforts ............................................................................. 22

Chapter five

5.1 Introduction ................................................................................... 25

5.2 Summary of major findings ................................................................. 25

5.3 Conclusion ..................................................................................... 26

5.4 Reco1nmendations ............................................................................ 26

Bibliography .................................................................................. 28