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A receivables agreement letter is a document that contains a binding agreement between the lender and the recipient of the loan. The letter contains a statement of the rights and obligations that need to be carried out by both parties according to the agreed terms. In addition, it also lists the nominal debt or loan given, the period of debt repayment, the method of payment, and so on related to the loan.

A debt and credit agreement can be binding between individuals and businesses. So, it can be made depending on their respective needs. A debt and credit agreement is the same as a loan and borrowing agreement which is regulated in Article 1754 of the Civil Code. The article states, “A loan and borrowing agreement is a commitment of the first party to provide a number of funds or goods. Usually some things that are loaned are consumable.”

Functions of an Accounts Payable Agreement Letter

Reporting from the Neo Commerce Bank page, there are a number of functions for the creation of an accounts payable agreement letter, which are as follows:

1. Strong and legal proof of debt.
2. A clear loan transaction between the lender and the recipient of the loan.
3. Minimizes disputes between the lender and the recipient of the loan, for example in terms of payment dates and the amount of debt paid.

Components of an Accounts Payable Agreement Letter

The debt and credit agreement letter contains several components that need to be considered. All of these components need to be written so that both parties can understand the agreement that has been made. Here are the details:

1. Personal data of both parties (such as name, address, KTP number, occupation and others)
2. The total amount or nominal amount of money borrowed
3. Total amount of payment
4. Purpose of the loan
5. Period of repayment
6. Monthly payment amount (if necessary)
7. Loan collateral (if necessary)
8. Interest or compensation rate

Source : finance.detik.com