Portfolio Monitoring Helps You Achieve More
Credit monitoring is a key tool in managing risks and maximizing revenue. Often, being the first to know about financial distress can help creditors ensure collection of their assets from distressed accounts. The converse is also true. Quickly spotting accounts on their way up provides opportunities for growth that may not be there for latecomers. Effective use of credit monitoring can help credit managers partner with customers who are on the way up and limit exposure to those on the way down.
Active credit monitoring has significant advantages over batch portfolio scoring or periodic credit report reviews when it comes to catching changes in credit risk. Monitoring provides continuously-updated information, rather than snapshots delivered every few months. This constant monitoring is advantageous because many changes can occur between regular reviews.
Credit managers can take protective action on accounts that exhibit increasing late payment, higher credit utilization and derogatory events like collections, liens and bankruptcy.
Opportunities for increased revenue or quick collection of past debts can be discovered when a customer suddenly shows an increased ability to pay as exhibited by a drop in days beyond terms or marked decrease in credit utilization or outstanding balance. Frequently, the first one to capitalize on these opportunities is the only one to benefit.
Credit monitoring has a long track record in consumer credit and the practice has gained significantly in the B2B world since the economic downturn at the end of the last decade. Credit managers need every tool at their disposal to get the most out of their customer credit portfolios. When success depending on the ability to minimize risk and maximize revenue, credit monitoring can help.
Ask your BCR representative how you can get started monitoring your customers. There are a variety of ways, some as simple as pulling a credit report. We’re here to help you meet and exceed your goals.