Credit score

A credit score is an assessment of a person or company's creditworthiness, often represented by a number, but it can also be expressed by colors or letters. This rating is crucial in determining how much credit to grant and under what conditions.

What is a Credit Score?

A credit score is a numerical or symbolic indication of the creditworthiness of an individual or business. It is used to assess how much credit and how long a credit period should be granted to the debtor. A low credit score can result in a shorter credit period or payment on delivery requirements.

Building a credit score

Credit scores are based on various economic, demographic and geographical data and it is often up to the creditor to determine the criteria. Many companies only use a few sources, such as whether the debtor is registered in debt registers such as RKI/Experian or the Debtor List.

Can you create your own credit score?

Yes, it is possible to create your own scoring system to assess creditworthiness based on internal data from your ERP system, such as customer payment history. However, such assessments often lack external information from debt registers.

How to use credit scores in your business

For companies that want to minimize the risk of losses on debtors, it is important to actively use credit scores. A low credit score does not necessarily have to deny credit, but can adjust the terms for granting credit.

Getting started with Qatchr

At Qatchr, our proprietary credit platform, we help businesses run detailed credit checks. Our tool provides a comprehensive insight into customers' financial circumstances, leading to more nuanced and accurate assessments.

Summing up

• Definition of chain score: Assessment of the creditworthiness of individuals or companies.
• Usage: Determines credit quantity and conditions.
• Basis: Economic, demographic and geographical data.
• Own credit score: Possible to create internally based on payment history and public records.
• Qatchr: Offers detailed credit checks for better insights and risk management.