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 assessments are based on one or more searches in debtor registers - such as Debitorlisten, which you can access via various credit check services. In Collectia, we own the platform Qatchr.dk, which can check if customers or suppliers are registered as bad payers.

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 credit risk for you and your business. A risk that can be minimized if you continuously perform credit assessments of 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 if you choose to connect your CRM or accounting software with a credit rating service, for example, it allows your business to always have the latest credit ratings, without any extra work for your employees.

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 perform credit checks on your customers without any obligation. The check provides valuable credit information that you can use in your credit rating. Get access to consumer credit checks and business credit checks today. We offer a 14-day free trial.