Credit Management: #3 Setting Credit Limit for Customers

Think about that one familiar customer of yours who always buys on credit. They usually pay on time, maybe a little late here and there, but not alarming. So, you are fine saying, "Sure, pay later."

Then, one day, they place a significantly bigger order than usual. That's great news for you, until you notice their previous invoices were unpaid. Suddenly, you're wondering, "Should I accept this order or wait for earlier payments?"

This is a dilemma many business owners secretly face.

How much credit is too much credit?

It's not because customers are unreliable. Cash flow is the oxygen for the business, and too many unpaid invoices can unexpectedly suffocate operations.

That's precisely why credit limits exist.

They allow customers to buy on credit within a reasonable, predefined limit. They aren't about mistrust; they are about protecting the relationship, your cash flow, and the health of your business at the same time.

Just like speed limits keep drivers safe, credit limits keep finances balanced.

So, What Exactly is a Credit Limit? 

A credit limit is the maximum unpaid amount you'll allow a customer to owe your business. Think of it like a spending cap. It ensures your customer has breathing space to pay later and keeps your cash flow healthy.

Here is how it usually works:

• You allow your customers to buy up to $10,000 on credit.

• They can continue making new purchases if their unpaid invoices are below $10,000.

• Once they hit that limit, you pause new sales until some of their dues are cleared.

 It's pretty simple. Right? It's a small step that keeps your receivables from growing out of control.

​
Why is it Important? 

When you extend credit, you lead your product or service until the customer pays. That trust can pile up without limits into overdue invoices and unexpected cash crunches. Credit limits act like a speed breaker for running away receivables.

• It protects cash flow by keeping too much money from being tied up in unpaid invoices.

• It reduces the risk of delayed customer payments, and your losses stay within safe boundaries.

• It encourages quick payments as customers pay faster when they know their limit is close.

• It brings predictability, making forecasting the income and plan easier.

Managing Credit Limits in Zoho Billing 

Zoho Billing does the heavy lifting of managing your customer credits automatically with little to no manual intervention.

Some of the key aspects that are covered by using Customer Credit Limit are listed below.

Personalised Credit for Every Customer

Zoho Billing allows you to assign a maximum outstanding balance for each customer. Instead of treating all customers the same, you can tailor these limits based on their payment history, purchasing patterns, and the level of trust you've built with them over time. This creates a more personalised approach to credit rather than relying on assumptions or informal agreements.

Real-time Visibility on Outstanding Balances

Once credit limits are in place, Zoho Billing gives you real-time visibility into each customer's outstanding balance. At any point, you can review how much credit a customer has already used and how much room remains. This clarity helps you detect early signs of overextension before overdue invoices start piling up. It's the information that would otherwise require manual tracking.

Alerts When Credit Limits Are Exceeded

When a customer's unpaid invoices push them beyond their assigned limit, Zoho Billing highlights the situation immediately. Instead of discovering credit issues after they've already grown, you'll be notified when risk increases. This allows you to pause, have a timely conversation with the customer and ensure earlier invoices are settled before additional credits are offered.

Controlling New Invoices Based on Limits

For businesses that want firmer control, Zoho Billing can be configured to block the creation of new invoices once a customer surpasses their limit. This reinforces healthy payment behaviour by encouraging customers to clear pending dues sooner. It also protects your receivables from growing beyond your business's comfort level.

Adjusting Limits as Relationship Evolves

As customer relationships evolve, so can their credit limits. With Zoho Billing, you can easily adjust a customer's limit upwards when they consistently pay on time, rewarding reliability with increased flexibility. Likewise, in case payment patterns slow down, you can tighten their limit to shield your cash flow. This dynamic approach ensures that credit policies stay fair and adaptable rather than rigid or outdated.

Bringing Automation to Credit Control

Zoho Billing, on the whole, turns credit limit management into an integrated part of your billing process. Instead of manually flagging later payments or tracking balances in spreadsheets, the system automates it for you. It provides the visibility, alert, and enforcement needed to keep credit extensions safe, predictable and structured. By offering credit responsibly and monitoring it wisely, you can drive growth without risking your business's financial health.

Control Vs Stop 

Keeping Credit under control is not about restricting customers but protecting your business's health. With Zoho billing, you can manage your credits with flexibility and clarity. This is crucial because a smart business operation isn't about saying no to credit but knowing where to stop. 

Credit limits are sorted. Great!

Here is the twist. What happens when a customer suddenly hits "Pause" on their subscription? Do their credits freeze?

In the next post, we will explore Pause Period Credits, a feature that makes your billing feel trustworthy and reliable.

 

• Topic Participants

• Hari Hara Sudhan. S

  

• Sticky Posts

• Community Learning Series | Digest #5 — September 2020

  Dear customers, We're happy to bring you the September edition of our #CommunityDigest! Keep track of your subscription KPIs right from your smartphone: Last month, we enhanced our Android mobile app to help our customers get daily updates on their business health. We got to know from a lot of customers that this has made their job much more easier because they no longer have to keep a reminder to manually check on the previous day's revenue or activations. If you have not downloaded it yet, here's

• Community Learning Series | Digest #4 - August 2020

  Dear customers, We hope you're staying safe and healthy. I'm happy to bring you the fourth edition of our #CommunityDigest with some brand-new updates from us. 1. Daily Business Updates (for Android users) The Zoho Subscriptions Android app has got a cool new update: You can now get a push notification to your smartphone that lets you know how many activations and cancellations have taken place, and what's the net revenue for the previous day. The best part is, you can tell the app when exactly you

• Community Learning Series | Digest #3 - July 2020

  Dear customers, We hope you're staying safe and healthy. We're glad to bring you the July edition of our #CommunityDigest. New community members can view our previous newsletters here. This time, we have two major updates and three interesting topics for you: 1. Zoho Subscriptions Developer Community Since the inception of Zoho Subscriptions, our team believed that the recurring billing platform we provide should be able to offer an extensive API library that empowers businesses to automate most

• Introducing: Community Learning Series | Digest #1 - May 2020

  Dear customers, We hope you are staying safe and healthy. Helping businesses manage their customer subscriptions more efficiently has always been, and always will be, our goal at Zoho Subscriptions. We strongly believe this is possible if we grow together as a community and share what we know with each other. To nurture this shared learning experience, here is our brand-new Community Learning Series! ​ Welcome to the first edition of our digest! Each edition of our community digest includes guides

• Recent Topics

• Zoho CRM for Gmail Extension Not Working in Brave Browser?

  Is anyone able to get the Zoho CRM Chrome Extension working in the Brave browser? They're both built on the Chromium platform and every other Chrome Extension works with the exception of Zoho CRM for Gmail so any ideas here?

• Sharing URLs and direct access

  Hello, I am storing my team's email signature images on Workdrive. I am creating a public image download share and adding “?directDownload=true” so that the image can be accessed without the Workdrive interface. A few questions: 1) Can we generate friendly

• how to change the page signers see after signing a document in zoho sign

  Hello, How can I please change the page a signer sees after signing a document in Zoho Sign? I cannot seem to find it. As it is now, it shows a default landing page "return to Zoho Sign Home". Thanks!

• Question about using custom_fields in Storefront Add-to-Cart API (error 2003 – required details)

  Hi everyone, I’m working with the Zoho Commerce Storefront API, specifically the Add to Cart endpoint: POST /storefront/api/v1/cart According to the documentation, this endpoint supports a custom_fields parameter for adding line-item custom data. I’m

• Can a project be cloned?

  Good afternoon, greetings. I would like to ask if it's possible to clone a project in Microsoft Project. I found a way to do it using templates, but I'm not sure if there's a direct way to clone a project. Thank you in advance for your attention, and

• Timesheet Tasks in Zoho Books: associate to service item

  How do we associate a service item to timesheet tasks in Zoho Books? For example: Joe spent 5 hours on project:task1 which is Service Item#1 (Income:Service1). When the invoice is issued thru the Project Invoice section, this is not available. When the

• Why Sharing Rules do Not support relative date comparison???

  I am creating a Sharing Rule and simply want to share where "Last Day of Coverage" (Date field) is Greater than TODAY (Starting Tomorrow). However, sharing rules don't have the option to compare a date field to a relative date (like today), only to Static

• Task/Activity indicator in SalesPipeline overview has disappeared

  I Just logged in my ZOHO CRM first 2026 checking my salespipeline overview , Every record card used to show an indication that there was an open task (Yellow if the expiry date was close, red if the expiry date was today and grey when it had expired).

• Tip #56- Accessibility Controls in Zoho Assist: Hearing- 'Insider Insights'

  As we begin the new year, it’s a great time to focus on making our tools more inclusive and accessible for everyone. Remote support often involves long hours in front of screens, varying lighting conditions, and users with diverse accessibility needs.

• Zoho Desk Android app update: Table view for All Departments view, custom button

  Hello everyone! In the latest version(v2.9.25) of the Zoho Desk Android app update, we have introduced Table view for the 'All Departments' view in the ticket module. We also have supported an option that allows tickets in the Table view to be sorted

• What's New - December 2025 | Zoho Backstage

  In December, Backstage introduced a focused set of updates that improve how you manage registrations, communicate with attendees, and track participation. These enhancements are designed to give organizers greater flexibility and clearer control across

• Need code format to specify default values

  Can someone please direct me to the code syntax or the proper translation per the instructions circled below. These instructions don't seem correct.

• Problem with CRM Connection not Refreshing Token

  I've setup a connection with Zoom in the CRM. I'm using this connection to automate some registrations, so my team doesn't have to manually create them in both the CRM and Zoom. Connection works great in my function until the token expires. It does not refresh and I have to manually revoke the connection and connect it again. I've chatted with Zoho about this and after emailing me that it couldn't be done I asked for specifics on why and they responded. "The connection is CRM is not a feature to

• Task Deletion Restriction & Strict Stage Control

  Hello Zoho Community, We have the following two issues currently pending and under testing, for which we require a workable and reliable solution: 1. Task Deletion Restriction We are testing ways to ensure that staff users are not able to delete tasks

• Add multiple users to a task

  When I´m assigning a task it is almost always related to more than one person. Practical situation: When a client request some improvement the related department opens the task with the situation and people related to it as the client itself, the salesman

• A Roundup of Zoho Sprints 2025

• Sorting Custom Date in API isn't working w pagination limit

  How can we sort a custom field with DATE using pagination? Starting at page=1 then moving to page=2 with a limit of 10 each, its all messed up and even shows some of the same records as page 1? https://www.zohoapis.com/crm/v2/INVOICE_MODULE/search?criteria=(FM_Contact_ID:equals:1234)&sort_by=Invoice_Date&sort_order=desc&per_page=10&page='

• SAP Business One(B1) integration is now live in Zoho Flow

  We’re excited to share that SAP Business One (B1) is now available in Zoho Flow! This means you can now build workflows that connect SAP B1 with other apps and automate routine processes without relying on custom code. Note: SAP Business One integration

• Enhancement in Role and Profile mapping of agents in Sandbox

  Hello everyone! We have brought in a modification in the way users are mapped to a particular role and profile in Sandbox. What has changed? When agents are copied from production to Sandbox: If a user's current role and profile is available in Sandbox,

• The reason I switched away from Zoho Notebook

  My main reason for switching to Zoho was driven by three core principles: moving away from US-based products, keeping my data within India as much as possible, and supporting Indian companies. With that intent, I’ve been actively de-Googling my digital

• Decimal places settings for exchange rates

  Hello, We are facing issues while matching vendor payments with banking feeds. As we often import products/services exchange rate comes into play. Currently, ZOHO allows only six digits for decimal places. We feel that conversions like JPY to INR require

• Zoho removed ability to see all Scheduled Reports!

  If you are not the owner of a scheduled report, Zoho recently removed the capability to see each scheduled report. As an admin who relies on seeing all scheduled reports being sent, this is a terrible update. Now I cannot see ANY scheduled reports...even the ones I am being sent!!  This should be a setting for admins to control.  This is a bad update.

• Automate Backups

  This is a feature request. Consider adding an auto backup feature. Where when you turn it on, it will auto backup on the 15-day schedule. For additional consideration, allow for the export of module data via API calls. Thank you for your consideration.

• GCLID and Zoho Bookings

  Is there anyway to embed a Zoho Bookings signup on a landing page and pass the GCLID information? More specifically, can this be done using auto-tagging and not manual tagging the GCLID? I know Zappier has an integration to do this but is there a better

• Merge Items

  Is there a work around for merging items? We currently have three names for one item, all have had a transaction associated so there is no deleting (just deactivating, which doesn't really help. It still appears so people are continuing to use it). I also can't assign inventory tracking to items used in past transactions, which I don't understand, this is an important feature moving forward.. It would be nice to merge into one item and be able to track inventory. Let me know if this is possible.

• Create PO from an invoice

  We are a hardware and software sales company which receives orders over the internet. We drop ship most of our products from a warehouse outside of our company. Our orders get sync'd into Zoho from our store via onesaas as invoices. It would be great

• Blueprint or Validation Rules for Invoices in Zoho Books

  Can I implement Blueprint or Validation Rules for Invoices in Zoho Books? Example, use case could be, Agent confirms from client that payment is done, but bank only syncs transactions tomorrow. in this case, Agent can update invoice status to done, and

• Resetting auto-number on new year

  Hi everyone! We have an auto-number with prefix "D{YYYY}-", it generates numbers like D2025-1, D2025-2, etc... How can we have it auto-reset at the beginning of the next year, so that it goes to D2026-1? Thanks!

• Delivery and handling of documents e-stamped using Zoho Sign

  Hello everyone! Zoho Sign makes it easy to pay non judicial stamp duty online and automatically attach the digitally generated e-stamp challan to electronic documents. We also manage the delivery of physical e-stamped papers. We periodically receive these

• The Social Wall: December 2025

  Hello everyone! As we wrap up the final edition of the Social Wall for 2025, it’s the perfect time to look at what went live during December. QR code generator From paying for coffee to scanning metro tickets, QR codes are everywhere and have made everyday

• Custom AI solutions with QuickML for Zoho CRM

  Hello everyone, Earlier, we introduced Custom AI Solutions in CRM that let you access QuickML for your custom AI needs. Building on that foundation, we’ve now enabled a deeper integration: QuickML models can be seamlessly integrated into CRM, and surface

• Helper Functions and DRY principle

  Hello everyone, I believe Deluge should be able to use 'Helper functions' inside the main function. I know I can create different standalones, but this is not helpful and confusing. I don't want 10000 different standalones, and I dont want to have to

• Add specific field value to URL

  Hi Everyone. I have the following code which is set to run from a subform when the user selects a value from a lookup field "Plant_Key" the URL opens a report but i want the report to be filtered on the matching field/value. so in the report there is

• Introducing workflow automation for the Products module

  Greetings, I hope all of you are doing well. We're happy to announce a few recent enhancements we've made to Bigin's Products module. The Products module in Bigin now supports Workflows, enabling you to automate routine actions. Along with this update,

• Power up your Kiosk Studio with Real-Time Data Capture, Client Scripts & More!

  Hello Everyone, We’re thrilled to announce a powerful set of enhancements to Kiosk Studio in Zoho CRM. These new updates give you more flexibility, faster record handling, and real-time data capture, making your Kiosk flows smarter and more efficient

• Zia Formula Expression Generator for Formula fields

  Hello everyone! Formula fields are super useful when you want your CRM to calculate things for you but writing the expression is where most people slow down. You know what you want, but you’re not fully sure which function to use, how the syntax should

• Issue with Zoho Creator Form Full-Screen View in CRM Related List Integration

  Hi Team, We have created a custom application in Zoho Creator and integrated it into Zoho CRM as a related list under the Vendor module, which we have renamed as Consignors. Within the Creator application, there is a form named “Pickup Request.” Inside

• Wrapping up 2025 on a high note: CRM Release Highlights of the year

  Dear Customers, 2025 was an eventful year for us at Zoho CRM. We’ve had releases of all sizes and impact, and we are excited to look back, break it down, and rediscover them with you! Before we rewind—we’d like to take a minute and sincerely thank you

• Directly Edit, Filter, and Sort Subforms on the Details Page

  Hello everyone, As you know, subforms allow you to associate multiple line items with a single record, greatly enhancing your data organization. For example, a sales order subform neatly lists all products, their quantities, amounts, and other relevant

• Customer Parent Account or Sub-Customer Account

  Some of clients as they have 50 to 300 branches, they required separate account statement with outlet name and number; which means we have to open new account for each branch individually. However, the main issue is that, when they make a payment, they

• Next Page