Getting the money that is due is known as credit control. The goal lies in shortening the time between providing a service to the client and receiving payment from the defaulters.
Controlling credit is a fine line to walk on.
On the other hand, it is crucial to obtain the money as soon as possible, or they may walk away. This is when you can employ a few procedures of business credit solutions policy and procedures, including.
#1: Create Clear Credit Control Process
It is important to develop a coordinated and transparent credit control process that can benefit MSMEs in India. The problem can be solved by a brief reminder of late or delayed payments that can put your company at risk of amassing bad debt.
Furthermore, because of the significance of credit control, companies must set realistic goals to prevent payment delays.
#2: Run Risk Analysis
Another important credit control policy and procedure that small businesses must adopt is running risk analysis on the new customers before the credit is extended. To be precise, go through the business credit history and payment reports.
The acceptable risk limit will be different for each organization. Also, start with a low credit limit to gain the clients’ trust if you choose to work with those with less-than-perfect credit.
#3: Change Payment Terms
Everyone has moved on with the traditional payment methods using paper checks and cash deposits.
Nowadays, companies prefer to accept payment online, and it has also become easier for customers. They are likely to make payments more quickly than ever. This eliminates the problem of cash flow and defaulters.
#4: Tightening Up Invoice Policies
Another credit control policy and procedure for small businesses that is suggested to adapt are providing prompt and correct invoices. This can bring effectiveness to the company.
Once the orders are fulfilled, organizations can send electronic invoices, ensuring that it is sent to the right person and there are no inaccuracies. This will also establish a strong connection and help them discover a cause to speak from time to time.
#5: Maintaining Good Relationship
This is the rule of credit control policy and procedure that often is underutilized. Companies should know that communication is the key that can help in maintaining good relationships.
One-way companies can do this is by calling the customers out of courtesy to confirm receipt of paperwork. This showcases that the business is also friendly, besides being professional.
#6: Incentivizing Early Payment
Offering discounts for early payment is one of the simplest ways to secure on-time payments and reduce the chances of having defaulters.
You can offer a little discount on the overall amount besides freebies to encourage clients to make their payments on time. This would encourage the customers to make timely payments without feeling discouraged.
Seek Professional Help for Credit Control Policy
When looking forward to the best business Credit Solutions, you can come to us at Credit Q. We are the leading service providers who assist all types of businesses and MSMEs.
You can report business credit defaulters to our professionals and expect to get business credit history reports without errors. Having decades of expertise, we have received a positive response rate from the reported defaulters. Moreover, all our services are highly budget-friendly, which is hard to find anywhere else.