Improving Credit Management and Debt Collection

The programme

Programme overview

Effective credit management is essential to maintaining healthy cash flow, protecting profitability and reducing exposure to bad debts. It extends far beyond following up overdue invoices. Strong credit management begins with making informed credit decisions, establishing appropriate terms and credit limits, maintaining accurate customer and billing information, monitoring changing risk, resolving disputes promptly and taking timely collection action.

Credit and debt collection professionals must therefore combine commercial judgement, financial awareness, communication and negotiation skills with disciplined credit-control and accounts receivable processes.

This course provides practical training across the credit management and debt collection cycle. Participants will learn how to assess customer creditworthiness, identify payment risks, establish effective credit policies, prioritise overdue accounts, communicate confidently with debtors, negotiate payment commitments and improve collection performance.

The comprehensive programme extends this foundation into financial statement analysis, credit scoring, portfolio segmentation, ongoing risk assessment, accounts receivable analytics, early-warning indicators, dispute management, recovery strategies and performance improvement.

Practical exercises, case studies, discussions and collection simulations ensure that participants can apply the techniques directly within their organisations.

Who should attend

Who is this programme for?

• Credit Managers and Credit Controllers
• Credit Officers
• Accounts Receivable Managers and Supervisors
• Accounts Receivable and Revenue Accountants
• Debt Collection Officers
• Billing and Collection Personnel
• Revenue Officers
• Finance Managers
• Financial Controllers
• Management Accountants
• Financial Accountants
• Finance Officers
• Budget Officers
• Chief Financial Officers and Financial Directors
• Loans and Credit Department Personnel
• Customer Account Administrators
• Sales Managers and Sales Personnel Working with Credit Customers
• Graduate and Management Trainees
• Professionals Responsible for Credit Risk, Receivables or Customer Collections

Learning outcomes

What you will learn

• Explain the relationship between credit management, accounts receivable, cash flow and profitability
• Apply effective credit management and control principles
• Assess customer creditworthiness using relevant financial and non-financial information
• Understand the purpose and essential components of an effective credit policy
• Establish appropriate credit terms and customer credit limits
• Identify early warning signs of deteriorating customer creditworthiness
• Prioritise overdue accounts using ageing, risk and customer information
• Apply practical debt collection strategies to improve payment performance
• Conduct professional and effective collection conversations
• Apply assertive communication, influencing and negotiation techniques
• Manage customer queries and disputes that delay payment
• Negotiate realistic payment commitments and repayment arrangements
• Improve cooperation between credit, finance, billing, sales and operational teams
• Monitor accounts receivable and collection performance using appropriate measures
• Apply structured escalation and recovery processes to overdue accounts
• Reduce exposure to overdue debt and potential bad-debt losses
• Improve cash collection and working-capital performance

Explore the programme

Detailed programme outline

2-Day Essentials — Training Outline

• The purpose and importance of effective credit management
• Why organisations extend credit
• The cost of credit
• Impact of overdue accounts and bad debts
• Relationship between credit management and cash flow
• Effect of overdue debt on profitability
• Main objectives of credit control
• Balancing sales growth with credit risk
• Purpose of a credit policy
• Essential components of an effective credit policy
• Credit terms and conditions
• Credit approval responsibilities
• Establishing customer credit limits
• Implementing credit procedures consistently
• Credit-control health checklist
• Identifying customers and their legal status
• Information required before granting credit
• Customer business and payment profiles
• Credit bureaux and commercial credit-information sources
• Trade references and payment histories
• Basic principles of credit evaluation
• Identifying customer risk characteristics
• Reviewing existing customers
• Understanding accounts receivable ageing
• Current and overdue accounts
• Identifying seriously overdue debt
• Customer payment behaviour
• Recognising early warning signs
• Identifying higher-risk accounts
• Prioritising collection activity
• Differentiating temporary payment delays from deteriorating credit risk
• Developing an effective collection approach
• Planning before contacting customers
• Understanding why customers do not pay
• Factors affecting payment behaviour
• Influencing customers to pay sooner
• Selecting the appropriate communication method
• Telephone, email and other appropriate digital collection channels
• Taking control of collection conversations tactfully
• Overcoming common reasons for non-payment
• Obtaining specific payment commitments
• Recording promises to pay
• Following up broken payment promises
• Closing collection conversations effectively
• Passive, aggressive and assertive behaviour
• Benefits of assertive collection communication
• Understanding different customer communication styles
• Handling objections and payment excuses
• Dealing with difficult customers
• Negotiating with large or commercially important customers
• Negotiating payment arrangements
• Maintaining customer relationships while protecting cash flow
• Confirming agreed payment actions and deadlines
• Impact of queries on payment delays
• Identifying common reasons for invoice disputes
• Purchase-order and documentation problems
• Billing errors and missing information
• Distinguishing genuine disputes from payment avoidance
• Improving front-end communication
• Developing an effective query-management process
• Working with sales, billing and operational teams
• Monitoring unresolved disputes
• Establishing collection escalation procedures
• When normal collection activity should be escalated
• Handling seriously overdue accounts
• Maintaining appropriate collection records
• Working with reputable external collection agencies where appropriate
• Awareness of legal and regulatory considerations
• Knowing when specialist recovery or legal assistance may be required
• Accounts receivable ageing
• Debtor days / Days Sales Outstanding
• Overdue debt percentages
• Collection targets
• Monitoring promises to pay
• Measuring collection outcomes
• Basic cash collection forecasting
• Identifying priority actions for improving performance

5-Day Comprehensive — Training Outline

• Purpose and importance of effective credit management
• Impact of bad debts
• Impact of overdue receivables on working capital
• Stimulating organisational cash flow
• Main objectives of credit management
• Balancing sales growth, customer relationships and credit risk
• Credit management within the order-to-cash cycle
• Purpose and objectives of a credit policy
• Customer onboarding requirements
• Credit approval authorities
• Establishing credit limits
• Credit review requirements
• Roles and responsibilities
• Escalation procedures
• Ensuring consistent policy implementation
• Reviewing and improving existing policies
• Knowing your customer
• Identifying customer legal status
• Essential information required before granting credit
• Financial and non-financial information
• Trade references
• Customer payment histories
• Industry and sector considerations
• Ownership and organisational structures
• Interpreting collected information
• Reviewing existing customers rather than relying only on initial approval
• Understanding the statement of financial position
• Understanding the statement of profit or loss
• Understanding cash flow information
• Accounting terminology relevant to credit professionals
• Assessing financial performance and financial position
• Understanding working capital
• Liquidity and solvency considerations
• Profitability and operating performance
• Recognising financial strengths and weaknesses
• Applying financial information without becoming an accountant
• Key liquidity ratios
• Working capital measures
• Profitability indicators
• Leverage and gearing
• Efficiency measures
• Cash conversion and operating-cycle considerations
• Interpreting financial trends
• Avoiding reliance on individual ratios
• Combining financial and commercial information
• Identifying higher commercial risks
• Principles of credit scoring
• Developing practical credit scorecards
• Financial scoring factors
• Non-financial scoring factors
• Customer risk ratings
• Differentiating low-, medium- and high-risk customers
• Establishing appropriate credit limits
• Matching credit terms to customer risk
• Reviewing and adjusting credit limits
• Documenting credit decisions
• Determining when additional credit safeguards may be required
• Why initial credit approval is not sufficient
• Monitoring changing customer risk
• Monitoring payment behaviour
• Industry and sector risk
• Economic and commercial risk factors
• Changes in customer financial position
• Early-warning indicators
• Deteriorating payment patterns
• Operational and management warning signs
• Customer-visit observations
• Reviewing higher-risk accounts more frequently
• Triggers for credit restriction or escalation
• Developing a structured collection strategy
• Planning collection activity
• Knowing the customer before making contact
• Factors influencing payment behaviour
• Segmenting customers according to risk, value and payment behaviour
• Recognising different debtor behaviours
• Selecting appropriate collection approaches
• Establishing collection timelines
• Managing promises to pay
• Following up broken commitments
• Passive, aggressive and assertive communication
• Benefits of assertive behaviour
• Maintaining professionalism under pressure
• Preparing for collection conversations
• Rules for successful collection calls
• Taking control of conversations tactfully
• Asking effective questions
• Identifying the real reason for non-payment
• Responding to excuses and delaying tactics
• Influencing customer behaviour
• Securing clear payment commitments
• Confirming payment dates and amounts
• Recording collection commitments
• Effective collection emails and written communication
• Using appropriate digital communication channels
• Following up consistently
• Understanding different communication and negotiation styles
• Preparing for payment negotiations
• Dealing with large and commercially powerful customers
• Face-to-face and remote negotiation techniques
• Understanding negotiating positions
• Handling objections
• Identifying realistic payment options
• Negotiating repayment arrangements
• Avoiding unnecessary concessions
• Confirming agreements and responsibilities
• Maintaining commercially important customer relationships
• Impact of customer queries on payment delays
• Identifying common causes of disputes
• Purchase-order problems
• Billing and invoice errors
• Missing supporting documentation
• Delivery and service disputes
• Developing a robust query-management process
• Assigning responsibility and turnaround times
• Preventing recurring billing problems
• Improving customer master-data accuracy
• Improving supporting documentation
• Using technology appropriately within billing and collection processes
• Building productive relationships between sales and credit
• Balancing revenue growth and credit risk
• Educating customers about credit terms
• Keeping sales teams informed about customer payment behaviour
• Role of sales in preventing overdue accounts
• Managing strategically important customers
• Resolving internal disagreements over credit decisions
• Coordinating action on high-risk customers
• Improving information flow between sales, billing, finance and credit teams
• Debtor days
• Days Sales Outstanding (DSO)
• Accounts receivable turnover
• Collection Effectiveness Index (CEI)
• Bad-debt trends
• Promise-to-pay performance
• Monitoring broken payment commitments
• Setting collection targets
• Measuring collector and portfolio performance
• Cash collection forecasting
• Linking receivables performance to working capital and profitability
• Understanding the size and composition of the receivables portfolio
• Segmenting accounts by value
• Segmenting accounts by ageing
• Segmenting accounts by credit risk
• Segmenting customers by payment behaviour
• Customer concentration risk
• Identifying strategically important accounts
• Prioritising limited collection resources
• Developing differentiated collection strategies
• Monitoring portfolio deterioration
• Common causes of business failure
• Cash flow difficulties
• Excessive borrowing
• Poor profitability
• Loss of major customers
• Operational problems
• Management and governance weaknesses
• Warning signs in everyday customer dealings
• Warning signs in financial information
• Warning signs during customer visits
• Distinguishing temporary financial difficulties from serious deterioration
• Taking preventative credit action
• Developing a structured escalation process
• Moving from routine collection to formal recovery
• Final-demand and escalation communication
• Internal authority for escalation
• Determining when normal collection activity has failed
• Evaluating the commercial value of further recovery action
• Maintaining appropriate records and supporting documentation
• Working with reputable external collection agencies
• Managing outsourced collection activity
• Monitoring external recovery results
• Understanding the legal environment surrounding debt recovery
• Consumer and commercial debt considerations
• Fair, professional and ethical collection practices
• Importance of accurate documentation
• Understanding formal recovery processes
• Obtaining and enforcing judgments where applicable
• Financially distressed and insolvent customers
• Knowing when specialist legal advice is required
• Evaluating the cost and commercial value of formal recovery action
• Important: Legal requirements and debt-recovery procedures must always be applied according to the jurisdiction in which the debt is being collected.
• Evaluating the debtor's ability to pay
• Instalment plans
• Restructuring payment commitments
• Negotiating out-of-court settlements where appropriate
• Evaluating settlement proposals
• Documenting agreements
• Monitoring compliance
• Responding to default on negotiated arrangements
• Integrating credit assessment, monitoring and collection
• Establishing clear responsibilities
• Applying consistent policies
• Strengthening escalation procedures
• Improving information flow
• Using collection and receivables data for decision-making
• Establishing meaningful performance targets
• Reviewing portfolio risk regularly
• Identifying process weaknesses
• Continuous improvement in credit management and collections

Learning approach

How you will learn

Our diverse instructional approaches ensure effective learning:

– Lectures & Presentations: Engage with expert-driven, stimulating content.– Course Material: Access well-crafted supporting resources.– Group Work: Collaborate on discussions and case studies for practical insights.– Workshops & Role-Play: Participate in immersive, scenario-based activities.– Practical Application: Focus on applying theoretical knowledge in real situations.– Post-Training Support: Receive extensive support after training for skill implementation.

Discuss your requirements

Dates, duration & arrangements

Contact Ratomac to confirm dates, duration, delivery format, entry requirements and any applicable assessment or certification before booking.