Guide

Credit checking your customers and setting credit limits

Introduction

Offering credit as a payment option can open your business up to new potential customers and increase your profits in the long term.

However, there are a number of factors you should consider before offering credit to customers. If customers default on their credit payments, it could leave your business short of finances and cause you problems. Ensuring that your customers can pay back the amount of credit you have allowed them should be a priority, and there are systems you can employ to help this happen.

This guide explains how to assess your potential customers' credit ratings and also covers checking new - and current - customers and how you should set their limits.