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title: "Credit Controls"
canonical: "https://kb.myframeworks.com.au/space/FRAM/28377336/Credit%20Controls"
format: markdown
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# Overview

Credit controls are a set of measures and policies that businesses implement to manage and regulate the extension of credit to their customers. Credit controls involve evaluating the creditworthiness of customers, setting credit limits, establishing payment terms, monitoring credit balances, and taking action to collect overdue debts. 

The purpose of credit controls is to minimise the risk of bad debt, improve cash flow, and maintain healthy customer relationships. By implementing effective credit controls, you can ensure that your business is extending credit only to customers who are likely to pay on time and in full, which helps to protect the financial health and stability of the business.

Within Frameworks, there are several functions and features to assist with Customer Credit Control. These are summarised below.

# Credit Manager

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# Credit Limit

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# Payment Terms

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# Credit Age

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# Credit Grace

A dollar (**$**) amount is defined by which customers may exceed their credit limit before orders require credit approval.

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# Credit Status

One of three valid codes that can be attached to a customer record to evoke specific action/s if a transaction is made to that customer.

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The credit status can be changed in two main ways, using one or all methods:

1. By manually going into the **Credit Data **tab within **Customer Maintenance** and changing the value of the field.
2. By the Debtors Month End process, where there are two questions that relate to customer credit.