Credit Plus Shares The 3 Most Effective Customer Portfolio Triggers to Minimize Business Credit Risk & Increase Collections

Do you have sufficient data, resources, and processes in place to identify credit risk on your own? If not, consider our Business Account Monitoring service, an external platform that you can use to monitor your credit portfolio automatically.  Our credit monitoring service will help you lower your credit risk and increase your collections. In addition, they give you an early warning of deteriorating customer credit.

Credit Plus offers insight/additional data elements not readily available such as:

  • Collections
  • Public record filings (such as liens, judgments, and bankruptcies)
  • Credit inquiries
  • And more

You cannot prevent your customer from engaging in risky financial behavior. The best you can do is to monitor your accounts to detect credit events that will affect your cash flow. However, manually monitoring your accounts requires constant attention. A more effective method is to automate your portfolio monitoring so you can be alerted when significant changes occur.

That’s precisely the purpose of a portfolio trigger. It is an automated alert or notification of a specific event that occurred on one of your accounts. You can set yourself up to receive portfolio triggers by:

  • Enrolling specific accounts for monitoring
  • Select trigger(s) – what types of credit risk events you want to be alerted to
  • Receive notification – obtain notification when/if the risky event occurs
  • Take action

Our Business Account Monitoring has more than 99 triggers that let you know of negative or positive events in your customer’s credit profile. But which ones are the most effective? Experian conducted a thorough study using three months of data and approximately 16 million unique alert records. It found these as the top three triggers:

  • Late 61-90 trade payment – There was a 15% likelihood of a business deteriorating in the next three months.
  • Late 31-60 trade payment – There was a 9% likelihood of a business deteriorating in the next three months. (The two triggers listed above are recorded by a lender or creditor about a specific business.)
  • Derogatory comment – not paying as agreed – Though this doesn’t get reported often when it does, you should take notice because that business has a 13% chance of going bad by the next quarter. When this is recorded on a business, the creditor is extremely frustrated and hoping that a derogatory comment will help them get repaid.

Business Account Monitoring from Credit Plus

Our portfolio monitoring service also offers notices so you can detect early signs of trouble on your business accounts.

Business Notices – Receive the most recent negative changes to a customer’s financial status weekly and bankruptcy filings daily.

Owner Notices – Learn when the owners or guarantors have financial difficulties long before your profit margin is impacted. Receive daily alerts for public records, including bankruptcies, derogatory payment information, collections, and more.

We can even score your portfolio to identify not only credit risks but opportunities as well. By reviewing up-to-date information on your customers, you can reduce delinquencies and maximize your profits. Portfolio scoring allows you to focus on only those who pose a credit risk or show potential for additional revenue. You’ll also be able to identify trends in your portfolio and refine your credit policy and practices accordingly.

If we’ve learned anything since 2020, it’s that the dynamics of a business can change incredibly quickly – so it’s essential to monitor them constantly. After all, you don’t want your business to end up with a tremendous amount of uncollected debt. Account monitoring is the most efficient way to minimize your risk.

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