4 Ways an Automated Credit Control Function Can Transform Your Business

Businesses, irrespective of their size and operating industry, often dedicate considerable time and resources to chasing down customers who haven’t paid their invoices. This is where credit control automation steps in, transforming the efficiency of this crucial task. On the other hand, some companies focus intensely on selling and expanding, overlooking the importance of robust credit control management. In both scenarios, the company’s cash flow suffers, potentially leading to financial instability. Credit control automation ensures that businesses can maintain healthy cash flows while minimizing the risk of financial distress.

What is the Importance of Credit Control?

Credit control is commonly defined as the process of extending credit to customers, then monitoring customer accounts and motivating customers to pay outstanding invoices. Due to its multi-faceted nature, credit control is often considered to be one of the most difficult finance function. To add to that, its efficiency directly impacts the cash flow of an organization, which is amongst the most important financial metrics for any business.

Early Signs of a Weak Credit Control System

Owing to talent pool limitations and high hiring costs, building an effective credit control is a tough deal. Many businesses, even after building an onshore team, fail to proactively manage their receivables. As a result, customers manage to get relaxation on their payment cycles, leading to increased bad debts.

To add to that, many companies continue to rely on manual process for credit control management. Not only does this hamper overall efficiency, but also increases the chances of human errors. Absence of staff due to factors like illness and holidays can further affect the timeliness of incoming payments. Additionally, credit controllers might also fail to communicate and follow-up on payments effectively.

RELATED BLOG: Wondering what qualities make for a high-performing credit control professional? Click here to find out.

How Can an Automated, Professional Credit Control Help?

As companies realize the importance of credit control in ensuring business continuity, finance leaders are increasingly turning to automated solutions to optimize the function. Let us take a look at some of the ways in which credit control automation can enable finance transformation:

1. Streamlined Workflows: Introducing technology to your credit control system immediately reduces dependence on your workforce, freeing them up for higher-value tasks. AI-driven solutions allow businesses to not only digitize, but also build customized workflows for individual customers, based on smart profiling.

2. Improved Communication: One of the main reasons why customers tend to make late payments is because of lack of clear communication from credit control professionals. In fact, these professionals might also find it difficult to send frequent payment reminders owing to their personal relationship with the customers.

Automating credit control eliminates any possibility of personal emotions getting in the way. These tools allow companies automatically track payment status and send out payment reminders that are both firm yet professional in nature. With timely reminders, debt is more likely to be recovered with minimum delay, using the minimum resources.

3. Accurate Data Management & Forecasting: Data forms a key element for any credit controller as it not only facilitates decision-making around putting clients on hold but also forecast cash flow. However, the laborious nature of credit control function keeps onshore teams scrambling with day-to-day tasks, ignoring the potential of financial data completely.

A professional credit control that is backed by technology provides onshore teams with easily digestible insights that enable better-informed financial decisions and increase accuracy of cash flow forecasting. Since automation frees up onshore teams of repetitive tasks, these resources can better leverage data by focusing on activities like data analysis and customer management.

4. Infinite Business Scalability: Not only is finding & retaining skilled credit control professionals expensive, but it also limits business growth to an extent. Frequent peaks & troughs can cause upheaval within finance teams and lead to burnouts.

Automating credit control reduces human dependence as most of the tasks are automated. As a result, the business achieves added scalability, making it possible to manage as many customers and payments as required.

RELATED CASE STUDY: Read the case study to find out how QX’s outsourced order-to-cash services helped a leading recruiter transform their receivables.

Outsourced Credit Control to Implement Automation

By now you must be aware of the importance of credit control and how automation can help accelerate your finance transformation goals. Technology implementation, however, is a critical business decision that requires great deal of expertise and capital investment. Partnering with a specialist outsourced credit control company can assure digital transformation success.

QX Global Group is a leading, business process outsourcing company offering highly customized finance & accounting solutions to businesses across geographies. Our outsourced credit control solutions allow you to optimize cash flow, implement smart technology and introduce a scalable team of credit control experts to your business. Get in touch to speak with our finance transformation experts today!

Originally published Dec 20, 2021 06:12:04, updated Apr 09 2025

Topics: Credit Control Process