Define: Credit Control

Credit control refers to the process of managing and monitoring the credit extended to customers to ensure timely payment and minimise the risk of bad debts.

Credit control helps businesses maintain a healthy cash flow, reduce the risk of bad debts, and improve their credit rating.

There are no specific legal requirements for credit control, but businesses must comply with consumer protection laws and regulations when dealing with customers.

Yes, a business has the right to refuse to extend credit to a customer if they do not meet the credit criteria or have a poor credit history.

Yes, a business can charge interest on overdue payments as long as the terms and conditions of the credit agreement allow for it.

The maximum interest rate that can be charged on overdue payments varies by jurisdiction and may be subject to consumer protection laws and regulations.

Non-payment can result in late payment fees, interest charges, damage to credit ratings, legal action, and enforcement action such as asset seizure or bankruptcy.

A business can prevent bad debts by conducting credit checks on customers, setting credit limits, monitoring payment behaviour, and taking prompt action to recover overdue payments.

The best practices for credit control include setting clear credit policies and procedures, communicating with customers about payment terms and expectations, monitoring payment behaviour, and taking prompt action to recover overdue payments.