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- Types of Credit: Consumer Credit; Bank Credit; Commercial Credit; B2B; Business to Business
- Written Credit Policy Manual
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Credit Policy Checklist
A well-defined and complete credit policy includes:
1. The formal organization chart for the credit department;
2. Job description, titles, and the performance review process fot the credit team;
3. Credit department budget guidelines;
4. Credit documentation required for credit file;
5. Methods of gathering credit information;
6. Time limits for credit decisions;
7. Established credit lines and procedure for establishing new lines;
8. Procedure for communicating the decision to the customer;
9. Procedure for communicating the decision to management;
10. Procedure for communicating the decision to the sales department;
11. Procedure for communicating the decision to operations;
12. Guidelines for dealing with and assisting marginal accounts;
13. A collection policy that reduces borrowing cost;
14. A collection policy that deals with slow-paying accounts;
15. A collection policy that minimizes bad debts;
16. A policy for unearned discounts/unauthorized deductions;
17. A policy for the handling of disputes;
18. A policy for the handling of returned and damaged merchandise;
19. Establishment of terms of sale;
20. Policies for using secured transaction for protection;
21. A policy for the use of guarantees;
22. Guidelines for reporting to upper management.
Edited by Michael C. Dennis, author of "1001 Collection Tools and Tips."