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

• Lookup Field Option Not Available in Customization

  Hello, I am trying to customize different modules (e.g., Work Orders, Systems, and others), but I am unable to find the Lookup field option in the layout customization. When I go to: Setup → Customization → Modules and Fields → Add Field The Lookup field

• Zoho recruit's blueprint configuration is not functioning as mapped

  Current Status: Zoho Blueprint is not functioning as configured. Issue: We are moving a Candidate status in Zoho Recruit "for active file" but we encountered: "Status cannot be changed for records involved in Blueprint." This happens to various client

• validation rules doesn't work in Blueprint when it is validated using function?

  I have tried to create a validation rule in the deal module. it works if I try to create a deal manually or if I try to update the empty field inside a deal. but when I try to update the field via the blueprint mandatory field, it seems the validation

• Integrating Zoho Suite and apps more with Linux

  I just got introduced with Zoho just couple of months ago, and I've already planned to contribute to it, even though it's not an open-source software. Still I have found it's potential to beat the tech giants and still being respective towards data privacy

• Multiple upload field CRM

  I desperately need the functionality to add more than one upload field to web to contacts form. How can I do this?

• Stage History previous stage to new stage

  We are looking for a way to display deals that have changed stages the previous week. We want to see what stage it was previously and what it was changed to, as well as salespersons names if possible. I've tried to create a report as well as looked into

• Global Search Settings

  I'd love a way to remove some modules from being included in the global search. This would allow use to provide a better user experience, limiting the global search to only those modules that are regularly used removing any models used for background

• How do I edit the Calendar Invite notifications for Interviews in Recruit?

  I'm setting up the Zoho Recruit Interview Calendar system but there's some notifications I don't have any control over. I've turned off all Workflows and Automations related to the Calendar Scheduling and it seems that it's the notification that is sent

• Store Submitted Forms as PDF

  Hi there, Is there a method to store Form submissions as a PDF in workdrive for archival? I set the form to email the submission to the user and an internal inbox but I'd really love to store the final form as PDF in workdrive automatically. I can't seem

• Zoho CRM || Unable to Bulk Assignment of Territories for Contacts

  Dear Zoho CRM Support Team, I hope this email finds you well. We recently performed a bulk upload of Contacts into Zoho CRM using the official sample Excel template downloaded from the CRM. The upload itself was completed successfully; however, we encountered

• Important Update: Google Ads & YouTube Ads API Migration

  To maintain platform performance and align with Google's newest requirements, we are updating the Google Ads and YouTube Ads integrations by migrating from API v19 to the newer v22, before the official deprecation of v19 on February 11, 2026. Reference:

• Separate Items & Services

  Hi, please separate items and services into different categories. Thank you

• Scheduled sending of a poll and its results

  Is there a way to schedule sending a poll to all my users and have the results sent separately to the team?

• How to list services on quote instead of products

  I need to create a customer facing estimate that displays our services. The default quote layout only allows products to be listed. Is there a way to correct this?

• Customize Calendar view in Teamspaces Settings

  Right now every customization that happens inside of the calendar view inside of CRM is only visible for the specific user. We want to be able to set up calendar views as an admin for specific roles. I would suggest to do that inside of the settings of

• CRM->INVENTORY, sync products as composite items

  We have a product team working in the CRM, as it’s more convenient than using Books or Inventory—especially with features like Blueprints being available. Once a product reaches a certain stage, it needs to become visible in Inventory. To achieve this,

• Add an option to disable ZIA suggestions

  Currently, ZIA in Zoho Inventory automatically provides suggestions, such as sending order confirmation emails. However, there is no way to disable this feature. In our case, orders are automatically created by customers, and we’ve built a custom workflow

• What's new in Zoho Sheet: Simplify data entry and collaboration

  Hello, Zoho Sheet community! Last year, our team was focused on research and development so we could deliver updates that enhance your spreadsheet experience. This year, we’re excited to deliver those enhancements—but we'll be rolling them out incrementally

• Zoho Desk API - Send Reply to CUSTOMERPORTAL

  Hello! I'll try to send a reply to Customer Portal, But the response is 500 (INTERNAL_SERVER_ERROR in service response). {"Error":"{\"errorCode\":\"INTERNAL_SERVER_ERROR\",\"message\":\"An internal server error occurred while performing this operation.\"}"}

• Zoho Creator Developer Console | Improved Distribution and Lifecycle Management for apps

  Hello everyone, We're excited to introduce new enhancements now in the Zoho Creator Developer Console. These updates strengthen private app distribution through licensing controls and extend environment support across all installed apps, helping teams

• CRM gets location smart with the all new Map View: visualize records, locate records within any radius, and more

  Hello all, We've introduced a new way to work with location data in Zoho CRM: the Map View. Instead of scrolling through endless lists, your records now appear as pins on a map. Built on top of the all-new address field and powered by Mappls (MapMyIndia),

• WhatsApp IM in Zoho Desk always routes to Admin instead of assigned agent

  Hello Zoho Experts, I connected WhatsApp IM to my Zoho Desk account. I only assigned my Customer Service (CS) agent to the WhatsApp channel, and I did NOT include Admin in this channel. However, every new WhatsApp conversation automatically gets assigned

• Zoho CRM for Everyone's NextGen UI Gets an Upgrade

  Hello Everyone We've made improvements to Zoho CRM for Everyone's Nextgen UI. These changes are the result of valuable feedback from you where we’ve focused on improving usability, providing wider screen space, and making navigation smoother so everything

• [Webinar] Solving business challenges- Handling the challenge of transitioning to Zoho Writer from legacy tools

  Moving to Zoho Writer is a great way to consolidate your business tools and become more agile. With multiple accessibility modes, no-code automation, and extensive integration with business apps and content platforms, Zoho Writer helps solve your organization's

• hide resolution from help centre

  to my surprise, i just found out that the resolution text is public in the helpcenter, even if 'notify customer' is off. is there a workaround to that? how do others deal with this? How zoho support does this and I don't think its used by Zoho in the first place. the resolution is meant to be private, not public

• Feature Request - Gift Cards or Gift Voucher Capability in Zoho Commerce

  Hi Zoho Commerce team, I'm comming accross more and more retail businesses who sell gift cards. As there is currently no way to manage this in Zoho Commerce, it is a blocker to addoption. This is particularly popular in Europe and North America. I recently

• Highlight a candidate who is "off limits"

  Hello: Is there a way to highlight a candidate who is "off limits"?  I would like to have the ability to make certain candidate and / or Client records highlighted in RED or something like that.   This would be used for example when we may have placed a candidate somewhere and we want everyone in our company to quickly and easily see that they are off limits.  The same would apply when we want to put a client or former client off limits so no one recruits out of there. How can this be done? Cheers,

• Closing off tasks automatically based on project status

  Is there a way to close off all open tasks when a project is set as Cancelled?

• CRM x WorkDrive: File storage for new CRM signups is now powered by WorkDrive

  Availability Editions: All DCs: All Release plan: Released for new signups in all DCs. It will be enabled for existing users in a phased manner in the upcoming months. Help documentation: Documents in Zoho CRM Manage folders in Documents tab Manage files

• [Free webinar] Understanding connections and datasources in Zoho Creator - Creator Tech Connect

  Hello everyone, We’re excited to invite you to another edition of the Creator Tech Connect webinar. About Creator Tech Connect The Creator Tech Connect series is a free monthly webinar featuring in-depth technical sessions designed for developers, administrators,

• Bridge the Gap Between your Service and Finance Teams

  In field service, the most expensive distance isn’t the drive to a customer’s home—it’s the gap between a finished job and a paid invoice. Zoho FSM leverages the power of Zoho Invoice to handle and manage billing operations. It enables you to: Instantly

• Direct URL to "View Record"

  I would like to create a button (Deluge Script) to jump to the "view record" without passing by the record menu, but I can not aford to find the right url. I don't want the "view record" as a single page. I want the "view record" in the application like the picture below: Thanks in advance for your help

• Live Chat for user

  Hi everyone, I’m new to Zoho Creator and wanted to ask if it’s possible to add a live chat option for all logged-in portal users so they can chat internally. I’m trying to create a customer portal similar to a service desk, but for vehicle breakdowns,

• SalesIQ Chat Owner to CRM Lead Owner Mapping

  There is no proper mapping between the SalesIQ chat owner and the CRM lead owner. When a chat is assigned to an agent, the lead created in CRM is often assigned to a different user, forcing admins to manually change ownership every time. This creates

• Does zoho inventory need Enterprise or Premium subsrciption to make Widgets.

  We have Zoho One Enterprise and yet we can't create widgets on inventory.

• Product line search in quotes

  Is there a way to change the search setting when you add a product line to a quote. We have created a field in products called 'Part Number' and I would like when I'm adding a product line to the quote that I can search on that field. At the moment it only searches on product description. In products I can search on the 'Part Number' field Any help welcome.

• Invoice status on write-off is "Paid" - how do I change this to "Written off"

  HI guys, I want to write off a couple of outstanding invoices, but when I do this, the status of the invoices shows as "Paid". Clearly this is not the case and I need to be able to see that they are written off in the customer's history. Is there a way

• 🚀 WorkDrive 6.0 (Phase 1): Empowering Teams with Content Intelligence, Automation, Accessibility, and Control

  Hello, everyone! WorkDrive continues to evolve from a robust file management solution into an intelligent, secure, and connected content collaboration platform for modern businesses. Our goal remains unchanged: to simplify teamwork, strengthen data security,

• Storage Limits

  Hello, What is the storage limitations for each user on professional edition?  Thanks, Mekki

• Optimum CRM setup for new B2B business

  Can some advise the most common way to setup Zoho CRM to handle sales for a B2B company? Specifically in how to handle inbound/outbound emails. I have spent hours researching online and can't seem to find an accepted approach, or even a tutorial. I have

• Next Page