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Credit Reference Agencies Don’t Just Provide Reports

In this guest Blog from Richard Brown – Development Director – Credit Assist Ltd, he explains how credit references agencies provide more than just credit reports and how these other services can be utilised in your business.

In Richards own words….

I’d like to follow up on Nicki’s excellent Blog from 14th December re. 9 Reasons Why You Should Credit Check Your Potential Customer which gave great advice on why this is imperative – particularly in the current environment when many companies will be experiencing cash flow difficulties. 

Chosing the Right Credit Agency

There is a wide choice of commercial credit reference agencies available with differing levels of data integrity and quality.

Therefore, when reviewing the market, you must ensure that the data you choose to subscribe to is of the highest quality so that you are making accurate and informed decisions when assessing a customer’s creditworthiness.

Monitoring

Nicki mentioned that some agencies offer a monitoring service and this will keep you abreast of any changes to your customers’ financial health. At Credit Assist we use 41 monitoring event triggers which will alert you to any changes to a company’s financial health, payment behaviour, operations, public record info, account filings, director details and more so you can react promptly on a daily basis.

Portfolio Management

The next step up from this is to utilise a portfolio management platform. More and more of our clients are now subscribing to our Live Ledger Analysis (LLA) platform which has a live data feed so that you can have real-time holistic visibility of where the risk lies across your entire ledger or ledgers.

For example, one of our clients has a master ledger across the entire group along with 17 divisional sub-ledgers so that they can assess and monitor both their group exposure and specific divisional risk.

Every day you must decide how much credit to extend to customers and prospects or when you should readjust your credit policy. LLA has the unique ability to do this for you by combining your ledger data with our latest risk ratings, credit limits, factual payment scores and financial data.

Identifying Risks and Opportunities

This information comes to you in the timeliest manner possible.

If any of these critical events occur to your clients, or there is a change to their credit rating, LLA will flag up a warning of any potential problems so that you can immediately adjust your credit terms or arrange a quicker collection.

With the click of a button, you can also extract all the customers on your ledger(s) which you are extending credit over and above our recommended limits and by how much. You can then reconsider how you are trading with these companies and mitigate the risk of delinquent payment and bad debt.

It will also identify commercial opportunities by showing you who the less risky customers are, with good financial strength and where you can advance more credit.

You might only be allowing up to £10,000 credit to a customer however our maximum recommended credit limit might suggest you could extend it up to £50,000. LLA shows the ‘gap’ which can then be exploited and increase sales.

Be Better Informed

I speak to many credit professionals on a daily basis and the underlying message I’m getting is that they want to be better informed of whether they are going to get paid – and if so when.

We have the most comprehensive payment data, profiles and predictive scores available on the market to enable them to do this and we can deliver this in a variety of ways bespoked to what best suits each client. Now is the time to review how you are performing and what changes could you implement to improve your credit process – we can help!

To find out more you can contact Credit Assist on 01604 217333 and view their website at https://www.creditassist.co.uk/ 

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