Credit Risk Management
Grow Your Business by Optimising Your Company’s Credit Policy
Do you sell by invoice or make credit agreements? Do you always find out the background and credit information of a new customer? The financial situation of a customer or partner may change in an instant, when even a familiar customer leaves their bill unpaid. That is why changes in the customer base must be monitored and own credit policy must be adjusted so that the company's business does not suffer.
Management and Optimisation of Credit Risks
Keep credit risks under control and optimise them to your advantageWhen a company sells by invoice or makes agreements based on credit, it is worth investing in credit risk management. Business always involves risks. However, by developing the company's credit policy, unnecessary risks can be eliminated, and the company's turnover can be increased in a controlled manner. The credit policy should also be updated regularly so that it remains up to date as the business environment changes.
Find out the background and credit information
By checking the customer's information, you avoid unexpected credit losses and invalid contracts.
Detect changes and react
Monitor changes in customers, react in time and avoid credit losses.
Optimise and automate
Fine-tuning the credit policy and automating the credit process enable additional sales without increasing the credit risk.
Find out the background and avoid credit losses
A credit loss occurs when the customer is unable to pay the invoice sent to them. The customer who has not paid the invoice is quite often an acquaintance of the entrepreneur whose financial situation has deteriorated. That's why it's important to check the background and credit information of each potential customer and monitor changes in the customers' ability to pay, in order to avoid unpleasant surprises. It is also worth checking the signature right to make sure the contract is valid. Credit information and credit ratings that predict payment defaults provide a solid foundation for your company's credit policy.
React in time to changes in the customer's finances
Financial situations can change quickly, which is why it is important to monitor the customers' situation. By monitoring customers' background information, it is possible to notice both risks and potential additional sales opportunities in time.
Monitoring the customer's situation and reacting to it can also strengthen the existing customer relationship. If the customer has momentary financial challenges, you can offer support proactively and thus increase customer satisfaction by showing interest in a challenging situation. At the same time, you protect your company's receivables.
Monitor and fine-tune your credit policy
You should monitor your own credit policy and the decisions made regularly. Have the current customers been able to pay their bills and what kinds of customers have caused credit losses? By fine-tuning the company's credit policy and automating credit granting processes, the company may achieve additional sales without a significant increase in credit risks. With our help, you can create a credit policy for your company, which helps you find good new customers for your company and manage to keep your best customers.
Services behind the solution
Consumer Credit Information
By knowing your customers, you can build suitable payment terms for different customers, and you can grow your business profitably. By checking payment defaults and other credit information entries, you significantly reduce the risk of credit losses.
Personal credit information describes the consumer's ability or willingness to pay. Payment default information collected from authorities or directly from creditors is registered as personal credit information in Finland. You will also receive information about the person's possible supervision of interests or business connections.
Did you know that a person with a payment default is 10 times more likely to obtain another payment default in a 12-month period than a person with no payment defaults at all? For this reason, creditors typically do not lend to such applicants – the credit risk is high.
Positive Credit Register
The Positive Credit Register will be introduced in 2024. Asiakastieto is currently building a solution, with the help of which companies granting credits to consumers in Finland can best make use of it. Irrespective of the number of credit decisions, Asiakastieto offers a suitable solution for different products and situations even so that the customer company does not necessarily need to resource its own IT work to process the data retrieved from the new register. Asiakastieto’s first solutions can be tested in the autumn of 2023 in order to ensure progress within the limits given by the schedule of the Positive Credit Register.
The Consumer Credit Inquiry System, launched in 2013, continues to operate and is being developed all the time. With the help of the positive credit information obtained from the system, 36 million responsible credit decisions have already been made.
Decision-making Services
We offer ready-made solutions to enhance online transactions for business and consumer customers. With our help, you can improve the customer experience and make automatic credit decisions.
You grant loans or sell products and services online, such as insurance or hotel rooms, you make similar recurring decisions on whether a business or consumer qualifies for a loan, whether to open a customer account for them, or if more can be sold to an existing customer. Naturally, you want to manage credit risk and ensure that your customer is satisfied with the experience and service they receive. Automating decisions releases the resources of human experts for development work, decision monitoring, and handling the most challenging applications.
Through Asiakastieto, companies make over 30 million business decisions annually!
Monitoring Services
Continuously monitor changes in the payment behaviour and financial status of your customers and partners and receive alerts automatically.
Knowing your customer is all about managing risk and minimising credit losses. Knowing your customers well also helps you to react quickly to changing situations. If, for example, a customer's payment delays become more frequent, the company should suspend the sale of products or services on credit and even prepare for collection action.
With the monitoring service, you can continuously monitor changes in the payment behaviour and financial situation of your customers and partners. The service detects changes in your customer base and you automatically receive alerts without delay. This allows you and your business more time to protect yourself against losses and be more successful in recoveries.
Company Credit Information
By checking the company's payment defaults and background information, you can ensure the company's reliability and financial situation. If a company's data shows payment defaults or other indications of financial difficulties, there is a higher risk than usual that e.g. the co-operation or shipping will not be completed. The situation of a company in financial difficulties can quickly turn to the point of supply problems, redundancies and even bankruptcy.
By knowing your customer, you can build suitable terms of payment for different customers and grow your business profitably. By finding out non-payment records and other credit score records, you will significantly lower the risks of bad debts.
Are you looking for a solution to another data challenge?
Do you want to know more about how you can manage your business credit risks?
Asiakastieto’s objective is to create value for each of its customers in a customised way, respecting the customer's wishes. Communication and understanding needs are the key to successful cooperation. Ask, discuss, and realise with us. It does not require any money from you, but in return for time you can gain a valuable understanding of the different stages and possibilities of managing business credit risks.
Would you like to hear more about how Asiakastieto can help your company manage and optimise credit risks? Leave a contact request and our expert will work with you to find the right solutions for your company.
