Take Your Business to the Next Level by Offering Your Customers Credit Lines
Are you a business owner who would like to offer more purchasing power and options to your customers? If so, implementing a revolving credit option could be a way you can achieve this and grow your business profits. Perhaps you are thinking that it would make accounting activities more difficult. This is an area that line of credit software could help with.
Beneficial to You and Customers
Some of your customers may have less than perfect credit, and if you deal with business-to-business transactions, you may have clients who are involved in start-up companies or struggling in terms of getting the capital needed to buy your products. These customers are likely to buy their goods from you on a revolving credit plan. This is because they may face difficulties securing credit elsewhere.
An in-house revolving credit program will allow you to charge interest on items that are financed, which means more revenue for your business. You may also choose to charge a fee for late or returned payments. Lines of credit software can be programmed to automatically calculate interest and other miscellaneous charges.
Consider offering reporting to credit bureaus. This is a benefit that can help your customers build or rebuild their credit and raise their credit scores.
Promotes Green Initiatives
If you decide to invest in line of credit software, there is a good chance that your business will use less paper. This is because the software will likely allow you to enter and store account information and loan agreements. This means that you will likely not have to print copies for your business filing needs. Copies would only need to be printed for customers to have for their records.
Your customers will appreciate being able to come to your location and get an immediate answer about whether they are approved for credit to purchase from you. You may also be able to make it possible for customers to make online financing requests.
If you do not want to outsource credit checks to a third-party, ensure that the software you select has a credit check feature. You can choose to compare reports from the top three bureaus, or you may choose one bureau to retrieve reports from. The ability to check the reports in-house via the software ensures faster decisions for customers. If they have to wait for days, they may change their mind about purchasing or they may try to find a competitor with similar finance options. Another reason to consider checking reports in-house is that it allows you to make decisions on a case-by-case basis rather than relying on the recommendation of a third-party company.
If you plan to check these reports yourself or have a credit manager, you need to decide specifically what you will look for to determine whether a potential customer is too great of a risk. For example, you may decide to extend a low initial credit line to someone who has bankruptcies and collection accounts that are less than two years old. Encourage reliable payment behaviors by offering customers line of credit software, a chance at higher credit lines as long as they pay on time and do not default on their agreements.