What is a debtor in accounting? Here's everything you need to know about debtors and what they mean for your business.
What is a debtor?
The word debtor comes from the Latin word 'debitor' and translated means 'to owe' or 'to be indebted to' - a creditor.
A debtor can be a company, a legal entity or an individual who owes money to a creditor. For example, if you receive an invoice from a company (a creditor) that you have to pay in 8 days, you are a debtor.
In other words, the opposite of a debtor is a creditor.
If you repay your debt or pay your invoice to a creditor, you are no longer the creditor's debtor.
Businesses are often both debtors and creditors.
Basically, when we talk about a customer relationship (buyer and seller), we are also talking about a debtor and creditor relationship.
Businesses can therefore be debtors to their suppliers - but they themselves have customers who are their debtors.
How we treat your customers
At Collectia, we believe that being 100% transparent and respecting all people, regardless of the situation, is the best way forward.
In many cases, a debt is an oversight or simply a situation where your customer has been inattentive. In other cases, your customer is in a difficult financial situation and is struggling to make ends meet. At Collectia, it makes no difference. We clearly see that the respectful dialog with a solution-oriented approach is the way forward.