Often a bank will require a loan officer to make personal visits on customers with loans outstanding. This is encouraged because:

Question

Quizplus · Accepted Answer

Making personal visits on customers with loans outstanding is an effective monitoring technique. It helps to reduce moral hazard by ensuring that the borrower is using the loan for its intended purpose and is making progress toward repayment. This helps the bank to mitigate the risk of default and to ensure a healthy loan portfolio.

Often a Bank Will Require a Loan Officer to Make