Finance How To Deal With Clients Who Violate Financial Credit Terms?

[Good-Guy]

When it comes to financial activities, it is very common to provide goods or services on credit. Credit is an important aspect of financial activity because it allows you build more trust and allows your client to purchase products and pay for it later in case the client himself or herself does not have cash at hand. Unfortunately, this facility often leads to the violation of financial credit terms. I am sure many people would say that we should not provide our services or products to such kind of customers who violate therems and conditions of financial credit but if the client has a really good history of paying credit, but this is the first time it has been happening that he or she is not able to pay, then don't you think that we should remain patient until the client pays us despite the credit terms' time period elapsing?

 

[Good luck]

It is likely to violate law lay down by a financial institutions or company if the company change its policy by increasing the interest rate that has agreed before and in the situation like this violation may set in and the two parties may have issues but if there's no new policy.Violator should face the riot of the law for violating.

 

[Alexandoy]

When I was managing my retailing business there was one big client who was always remiss with the payments. After giving him 30 days of credit he was able to wrangle a 60-day credit line. But the 60 days seemed to be not enough. His purchases would be paid after 2 months but usually delayed by 2 weeks. That greatly affected our cash flow that we had to stop giving him his orders.

 

[Deleted member 28127]

The people have credits with banks so the salary they get is hardly feeding their needs so that is why they do not want to give credits to friends or relatives. Additionnally, you may lose some friends when you accord them a loan because when it comes to money when friend is uncapable to pay back his credit he may change his phone number and may even try to prevent to contact you and this is common in credit management with friends unless you insist on pay back credit and invent new ways to get your money back.

 

[Good-Guy]

The people have credits with banks so the salary they get is hardly feeding their needs so that is why they do not want to give credits to friends or relatives. Additionnally, you may lose some friends when you accord them a loan because when it comes to money when friend is uncapable to pay back his credit he may change his phone number and may even try to prevent to contact you and this is common in credit management with friends unless you insist on pay back credit and invent new ways to get your money back.

I believe that if a person is not capable of paying back credit, then he or she must not purchase products on credit. Many people make this mistake. They purchase products using credit option and they also lose trust with the seller when they find it difficult to pay back the credit. Taking credit with friends is much worse.

 

[btaliat]

I don't advice business owners to be selling on credits. As a matter of fact, I cannot do it when I have my business. A customer that wants to buy much quantity on credit can buy what he can afford at the moment and come for the later when he's bouyant.

 

[Yusra3]

The minute a client defaults on their truck payments matter of fact tell them, but at the same time show understanding. Kindly notify payment deadline and reiterate the agreed terms and conditions as far as the credit is concerned. Put in the application of the late fees as per the policies and give a grace period. Another alternative may be to put a stoppage on the account if the payments are not caught up yet. Finally, a formal letter drawing attention to the overdue debt and specifying the period of time within which payment should be made along with the intent to initiate legal action shall be a final step. Set up appointment statement and penalties when they don't pay on time, this will help your small business to be financially healthy.