The credit control process is the set of checks and actions a business uses to manage customer credit and collect payment. It starts with the terms agreed at the point of sale, continues through invoicing and collection, and includes a clear route for disputes and overdue balances. For telecoms resellers, it also needs to account for recurring services, usage charges and ongoing customer relationships.
A useful process gives staff clear responsibility and access to current information. It should be possible to establish what the customer owes, whether they received the invoice, what has already been discussed and which action is appropriate next.
Key Takeaways
- Review credit exposure, agree terms, invoice accurately, follow up payments and assess unresolved balances.
- Use a named owner and a shared account history so work can continue across the team.
- Check payments, disputes and customer circumstances before escalating.
- Measure cash received separately from credits, write-offs and other balance reductions.
Stage 1: Assess Credit Exposure
Decide how much credit the business is prepared to extend and what evidence supports that decision. The review should be proportionate to the account’s value and potential exposure, including services already supplied but not yet billed.
For a limited company, Companies House provides identity and filing information. This is useful background rather than a guarantee of ability to pay. Credit-reference information, trade references and the customer’s payment history can inform a fuller assessment where the exposure warrants it.
Some larger organisations publish payment-practice reports through the government’s reporting service. Check whether the relevant legal entity is covered, rather than assuming every business publishes a report.
Review limits as the account changes. A customer adding sites, seats or high-volume usage can create substantially more exposure than the original order. A limit set at sign-up should remain part of account management throughout the relationship.
Stage 2: Agree Payment Terms
The order and contract should make the payment arrangements clear before service starts. Explain the billing cycle, when payment falls due, the collection method and how the customer can raise a query. Check that any purchase-order or invoice-submission requirements can be met.
For recurring services, identify how the first partial period, connection charges and usage will appear. A customer who understands the relationship between the quote and the invoice has the information needed to approve payment.
Late-payment remedies need deliberate wording and appropriate advice. Contractual terms can affect the statutory interest route, and rules differ by transaction and customer. GOV.UK’s commercial-payment guidance is a starting point for checking which remedy applies.
Stage 3: Raise and Deliver Accurate Invoices
Invoice preparation and delivery are part of credit control because unresolved errors can delay payment. Check the legal entity, billing contact, purchase order, service dates and charge detail. The amount due should be supported by the records behind the bill.
Delivery also needs a check. An invoice marked as sent may still have failed to reach its destination. Give the team a route to correct contact details, resend the document and record the outcome. Avoid treating a delivery failure as customer refusal to pay.
Where a query relates to one charge, record the disputed scope and investigate it. That allows the team to distinguish the amount under review from any undisputed balance, subject to the policy and protections that apply to the account.
Stage 4: Follow Up on a Defined Schedule
A schedule makes the next action visible and reduces reliance on individual memory. It can combine email, letters, SMS where appropriate and staff tasks. The following sequence describes purposes rather than prescribing fixed intervals:
- Confirm the amount due and provide a clear payment route.
- Check for a missing invoice, query or failed collection.
- Ask for a payment date where the customer needs more time.
- Review the response and decide whether another reminder, an arrangement or escalation is appropriate.
Record the conversation and the next review date. A promise to pay should include the agreed amount and date, with a process for checking whether it was kept. It is an expectation of payment, not a receipt or authority to take money automatically.
The sequence must respond to events on the account. Payment, a dispute, a complaint or evidence of financial difficulty can change the appropriate action. Our dunning guide explains how reminder workflows fit into the wider process.
Stage 5: Review Unresolved Balances
Escalation requires an assessment of the account and evidence. Establish whether the invoice is correct, whether the customer has received the relevant correspondence, and whether there is an unresolved dispute or support need. Then decide who has authority to act.
Options can include an agreed arrangement, a further account review, a contractual remedy or formal recovery advice. A service restriction needs its own decision under the contract and applicable telecoms obligations. A missed reminder deadline does not, by itself, justify suspension.
For qualifying commercial debts, fixed recovery costs may accompany interest. Use the late payment interest calculator to examine a specific invoice and the product guide to late-payment charges and automated chasing for the software workflow.
A write-off also needs separate accounting approval. Closing a chase case does not remove the underlying debt, and writing off a balance does not mean cash was recovered. Keep those outcomes distinct in reporting.
Payment Collection and Pre-Pay
An agreed automatic collection method can reduce the need for customers to initiate each payment. It still needs monitoring for failures, cancellations and chargebacks. Our payment collection service explains the available routes.
Pre-pay may suit services or accounts where the parties agree to fund usage in advance. Automatic top-up helps maintain that balance, but it does not guarantee successful collection or eliminate every possible debt. Ordinary invoices and other charges may still require credit control.
Measuring the Process
Review the aged debt report to understand which invoices need attention, and track debtor days as an indicator of collection performance. Use consistent measurement dates and definitions so changes can be explained.
A falling overdue balance may reflect receipts, credits, write-offs or a change in sales. Separate those causes before judging the result. Useful operational measures also include failed invoice deliveries, overdue promises, unassigned work and cases waiting for a decision.
Frequently Asked Questions
Who should be responsible for credit control?
Give the process a named owner with authority to coordinate action and escalate decisions. Other staff can share the work through assigned tasks and a common account history. Financial approvals and service restrictions should remain with the people authorised to make those decisions.
How soon should an overdue invoice be followed up?
Set the first follow-up around the agreed due date and your customer policy. Check that the invoice reached the correct contact and that payment is not already recorded or in progress. The timing and content should reflect the account and any applicable protections.
What are the five Cs of credit control?
Character, capacity, capital, collateral and conditions are factors used in credit assessment. They concern the customer’s record, ability to pay, financial resources, available security and wider circumstances. They inform a credit decision; they are different from the five operational stages described above.
Applying the Process in SAFE CRM
SAFE CRM brings the worklist, correspondence and billing position together. Pipelines define eligible accounts and staged actions, with contact prepared for approval or sent automatically according to configuration. Holds, disputes and payment checks can prevent an otherwise scheduled action from proceeding.
Arrange a demonstration to review that workflow using representative accounts and the approvals your team needs.