Credit rating
What is a credit rating?
A credit rating has no legal definition, but is basically an assessment of the credit you want/should/need to give to a customer.
Credit ratings are often used by larger businesses with many customers, but there is a growing trend for very small businesses to use credit ratings for their customers either at the beginning of the customer relationship or on an ongoing basis.
How to do a credit rating?
Today, it has never been easier to find information about your customers, and especially business customers can be really easy to find good valid information on. Because all Danish companies are registered with CVR.dk, and thus their accounts are (often) also available.
Access to the company's public accounts allows you as a company to make a subjective assessment of the customer before establishing a potential customer relationship.
CVR is far from perfect and only shows historical information that can be up to a year old. For example, CVR does not include recommendations, credit scoring or an overview of any previous defaulted debts.
While it is possible to carry out a free credit check for businesses, it is much more difficult with private customers. Here you often have to use krak, 118.dk or online search engines. This is often far from nuanced enough to make a good credit rating of a customer.
Therefore, we always recommend that your credit ratings are based on one or more debtor registers, such as services like Qatchr.dk, an online service owned by Collectia A/S.
By using a debtor/ debtorregister, you get historical information about your customers that other services don't offer.
Who should carry out credit ratings?
Anyone who trades with other businesses or individuals can be affected by bad payers. This means there is always a risk for you and your business. A risk that can be minimized if you carry out regular credit checks on your customers.
When should a credit check be carried out?
Firms that carry out credit assessments of their customers basically do so in two different ways, either at the establishment of a customer relationship or on an ongoing basis.
There are pros and cons to both models, but linking your CRM or accounting software with a credit rating service, for example, allows your business to always have the latest credit ratings without the need for extra work for your staff.
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How much does a credit rating cost?
The price of a credit rating varies depending on what you want to know about your customers. Some services have a fixed price, while others depend on what data you want on your customers.
Here at Collectia A / S, we are the owner of Qatchr - and here you can make credit ratings of your customers without any binding. Get access to credit rating of private customers and credit rating of companies today. We offer a 14-day free trial period.
