RisingERP - Credit Limit

Credit Limit

A Credit Limit represents the maximum amount of credit extended to a customer, indicating the threshold for the goods or services they can receive without upfront payment. It serves as a critical parameter in managing financial transactions and assessing a customer's creditworthiness.

The Credit Limit can be specified at various levels, offering flexibility in its application. The order of precedence for checking the Credit Limit includes:

1. Credit Limit set in Customer
2. Credit Limit set in Customer Group
3. Credit Limit set in Company

1. How to Establish a Credit Limit

Navigate to: Selling > Sales > Customer > Customer.

In the "Credit Limit and Payment Terms" section, specify the desired Credit Limit.

If left as the default (0), the Credit Limit will have no effect.

Save the changes.

2. Features

2.1 Credit Controller

This feature empowers users with a specific role to override Credit Limit validations, enabling the submission of Sales Orders or Sales Invoices even when the Customer's Credit Limit is fully utilized.

To set the Credit Controller role:

Go to: Accounting > Settings > Accounts Settings.

Specify the role in the "Credit Controller" field.

2.2 Bypass Credit Limit Check for Sales Order

For specific customers, you can tailor the credit limit check to assess the cumulative amount of outstanding sales invoices rather than sales orders. Activate this feature by selecting the 'Bypass credit limit check at Sales Order' checkbox in the 'Credit Limit and Payment Terms' section of the customer.

2.3 Credit Limit for Customer Groups

Establish Credit Limits at the Customer Group level:

Go to Selling > Customers > Customer Group.

Access the Customer Group and define the Credit Limit.



2.4 Credit Limit for Company

Setting a Credit Limit at the Company level ensures that all customers adhere to this global limit.

To establish a Credit Limit at the Company level:

Go to Accounting > Masters and Accounts > Company.

Access the Company profile and set the Credit Limit.