Term Payment Limits
Term payment limits represent the maximum amounts for which you can give goods or services with term payment. If too much merchandise is sold compared to the availability of payment, there is a risk of not collecting the respective amounts.
What is the Term Payment Limits Report?
Term payment limits represent the maximum amounts for which you can provide goods or services with deferred payment. In other words, they refer to the maximum value that your customers and collaborators can offer in the case of deferred payments.
Deferred payment instruments, such as promissory notes and checks, are used to settle invoices. Non-payment of these leads to the company being registered in the Payment Incidents Center. As a result, companies are more cautious and set higher payment limits for these than for invoices paid with payment orders.
If too much merchandise is sold compared to the availability of payment, there is a risk of not collecting the respective amounts.
By using a system such as term payment limits, you can assess the creditworthiness of your portfolio of clients, suppliers, and collaborators. Additionally, clearly establishing payment limits improves business relationships by understanding customer behavior.
Try it free for 7 days and find out the trade limits for any company of interest.
What is it used for and why should you use the Term Payment Limits Report?
The Term Payment Limits Report indicates the maximum working threshold between companies, ensuring that the supplier does not provide services, offer products, or grant merchandise disproportionately to the client's payment capacity.
The report presents the maximum amounts in lei for which suppliers can provide clients with goods or services on deferred payment terms. Set clear limits and collect on time.
If deferred payment sales are the main activity of your company, it is essential to know who you are invoicing and who your client is. Set limits and customize contractual terms that your client portfolio can adhere to, so that your company avoids the risk of non-payment.
The term payment limits report provides access to official data, facilitating the process of verifying the financial stability of the company.
The Term Payment Limits Report - the strategic tool for deferred payment sales
Company Reports
Generates financial reports and establishes the company's situation in relation to the industry it belongs to.
Rating Financiar
See the company's note based on financial data and related to the industry.
Financial Rating Report
Comp. Competition
You establish the direct competitors of the company and its positioning in the industry.
Competition Report
Company Value
Check the value at which the company can be sold according to the balance sheet.
Company Value Report
Insolvency Probability
Determines the risk of insolvency based on financial results.
Insolvency Probability ReportAdvantages and Benefits of Term Payment Limits
Limits vary depending on the accepted payment terms. Longer terms, such as 90 days, involve a higher risk of non-payment compared to 30-day terms.
- ✔ Optimal risk management: Early identification of risks by highlighting payment delays and negative precedents to avoid financial losses.
- ✔ Indicates the limits for invoices, checks, and promissory note payments: to ensure compliance with payment limits, they are reported to the financial history. Payment instruments such as promissory notes and checks involve major risks in the event of late payment and the registration of the company in the Payment Incidents Registry. Therefore, the payment limits for these are higher compared to those of invoices paid by bank transfer.
- ✔ Assessing client creditworthiness: The term payment limits report allows the identification of risks associated with various transactions and risk assessment, so that your company can avoid fraudulent collaborations.
- ✔ Establishing realistic payment limits: Analyze the report and estimate the cash capacity of your client portfolio based on recorded payment incidents over time.
- ✔ Analysis of client behavior: Access to clients' financial history allows the observation and analysis of their behavior: are payment delays or overdue terms frequent? Does the inability to pay become a habit?
- ✔ Optimizing business relationships: Grant realistic payment terms, adapted to the current market, and create a secure environment for your collaborator: analyze the report, then schedule the discussion and mutually agree on payment limits, building a relationship based on mutual trust.
- ✔ Improving cash flow: Since the information is reported to the data and financial situations of the company of interest, you can more easily manage situations with suppliers, clients, and collaborators, leading to efficient management of your company's cash flow.
It is important to note that the limits are theoretical and can be adjusted based on the payment history of each company, being determined based on financial indicators.
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2. Benefit from a free trial and see its usefulness for yourself.
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