Why your credit policy needs to be in writing
Short answer: without a documented policy, whoever happens to answer the phone makes the decision. A single A4 page of clear rules makes credit decisions consistent, easy to hand over and explainable to lenders, insurers and your accountant.
1. Customer approval
Describe the checks you carry out before the first delivery: identification through the Trade Register, an insolvency check, annual financial figures and — above a threshold amount — a credit report. Set the threshold, for example: below €2.500 a basic check only, above that a full report.
2. Limits
One limit per customer, including orders delivered but not yet invoiced. Set it using a consistent method and record it in your ERP system, so that exceeding it automatically triggers a block.
3. Approval authority
Who can approve which amounts, and who can lift a block? Without clear approval authority, any credit limit policy falls apart at the first large order.
4. Payment terms by risk category
| Category | Payment period | Security |
|---|---|---|
| Low | 30 days | none |
| Medium | 14 days | retention of title |
| High | payment in advance | deposit or bank guarantee |
5. Monitoring
Weekly aged receivables analysis, monthly DSO reporting and active monitoring of insolvency notices for your top-20 debtors. Specify who does this and when.
6. Payment demands and escalation
Set a fixed schedule: a reminder on day 3 after the due date, a formal payment demand on day 10, telephone contact on day 15, a delivery stop on day 21, debt collection on day 30. Consistent steps work better than case-by-case decisions.
7. Review
Review the following every quarter: DSO, write-offs as a percentage of turnover, the number of blocked orders and the number of deliveries made outside delegated authority. Adjust the policy accordingly.
A template in one paragraph
We only deliver after approval based on a credit check with a stated source and reference date. Each customer has a limit based on their needs, financial capacity and our own risk appetite. Exceeding the limit automatically triggers a block, which can only be lifted in accordance with the approval authority matrix. We monitor weekly, issue payment demands on a fixed schedule and review quarterly.
Would you like help substantiating your decisions for each debtor? Request credit information below.
Stappen om je beleid vast te leggen
- Beschrijf de informatie die nodig is voor klantacceptatie.
- Leg de methode voor limieten en de beslissingsbevoegdheden vast.
- Koppel voorwaarden en bewaking aan de gemaakte risicoafweging.
- Benoem een eigenaar voor escalatie en periodieke evaluatie.
From explanation to a company file
- Check a company's creditworthiness
Combine registration details, annual accounts, payment history and insolvency information before doing business.
- Credit report: example and request
View a clearly fictional file, its sources and limitations, and request credit information.
Sources and scope
Examples and policy choices in this article are illustrative, not a current quotation, fixed standard or financial or legal advice. The editorial revision date relates to the summary, structure and source references; it is not a reference date for the underlying data.
| Primary source | What is it used for? |
|---|---|
| KVK (Dutch Chamber of Commerce) — checking business partners | Company identification and checks on business partners. |
| De Rechtspraak — Central Insolvency Register | Official insolvency notices and available public reports; check the relevant entity and the date of the court ruling. |
Source links support the topic mentioned, but do not automatically substantiate all percentages, time frames or examples in this article. Check current terms and rules with the responsible authority.
Request credit information with sources and reference dates
