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 | Zoho Billing

  

• 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

• Ability to turn off "Would you like this amount to be reflected in the Payment field?" message

  Team, Is there any way to turn off the message" Would you like this amount to be reflected in the Payment field?" when I make a payment? This is so annoying. This happens EVERY TIME I put an amount in the Payment Made field.

• Unlock agreement intelligence with Zoho Sign's latest AI updates

  Hello! If you've been struggling with long, complex agreements and spending way too much time on them, here's exactly what you'll want to hear: Zoho Sign now integrates with OpenAI's ChatGPT to make agreement management smarter and simpler. Acting like

• Currency abbreviations

  Hello, Im stuck, and need help. I need the currency fields for example, opportunity value, or total revenue, to be abbreviated, lets say for 1,000 - 1K, 1,000,000 - 1M, and so on, how should I do this?

• Embed Sign Document

  Has anyone tried embedding a document in a webpage? I'm building a webpage (using PowerPage) and I'm trying to embed it using an iframe then I got this error: Refused to display 'https://sign.zoho.com/' in a frame because it set 'X-Frame-Options' to

• Zeptomail API error 500 internal server error

  Hi Everyone, getting this eror continuously! Can anyone please guide around the same! Zeptomail API error 500 internal server error Best Regards

• We’re transitioning from Zoho ShowTime to TrainerCentral

  Hello everyone, Zoho ShowTime was originally built as a training platform to serve training agencies, HR teams, and individual trainers. As the platform grew, we realized that more creators and businesses could benefit from its capabilities. That’s why

• Emails Are Not Being Delivered to My Inbox

  Hello Zoho Support Team, I am experiencing an issue with my Zoho Mail account. The most important problem is that emails are not being delivered to my inbox. Details: My Zoho Mail address: info@coreforcelife.com What happens: I am not receiving any incoming

• Radar In Focus: Track customer support metrics using Radar's static reports

  Hello everyone, Welcome back to the Radar In Focus series, where we explore how Radar features can add value to your business. In this episode, we're looking at Radar static reports. The help desk is filled with vast amounts of data that can be analyzed

• Mail ToDo & Tasks Webhooks

  Our company uses Zoho ToDo inside Mail to manage our tasks. When I create a task and assign it to a team member it does not notify them unless I add a reminder via mail. I'm trying to create a webhook for when a task is created to send a cliq message

• Allocating inventory to specific SO's

  Is there a way that allocate inventory to a specific sales order? For example, let's say we have 90 items in stock. Customer 1 orders 100 items. This allocates all 90 items to their order, and they have a back order for the remaining 10 items which could

• Improved UI for a Seamless User Experience - Calls, Tasks, and Meetings

  Hello all, We are making UI unification across CRM so that the UI experience is seamless across the product. As part of that effort, we have made changes to the details page of activity-based module records—Meetings, Calls, and Tasks. Let's look at these

• Where can I find rejected inbound mails and their reason for rejection

  Hi, I was recently made aware by a mailing list which I am subscribed to (ffmpeg-devel@ffmpeg.org) that my Zoho mail Mail account is rejecting some emails. If I look under Admin Panel > Security & Compliance > Quarantine > Incoming, the list there is

• Refund

  Hi There, Please refund me asap possible, because of no support given. Thank you

• تغيير عمله الدفع"Change payment currency"

  ما هى طريقه تغيير عمله الدفع "ما هي طريقة تغيير عملة الدفع؟"

• How do I fix this? Unable to send message; Reason:554 5.1.8 Email Outgoing Blocked.

  How do I fix this? Unable to send message; Reason:554 5.1.8 Email Outgoing Blocked.

• Attention API Users: Upcoming Support for Renaming System Fields

  Hello all! We are excited to announce an upcoming enhancement in Zoho CRM: support for renaming system-defined fields! Current Behavior Currently, system-defined fields returned by the GET - Fields Metadata API have display_label and field_label properties

• Zia's ability to generate and improve content extended to Desk mobile app (iOS and Android)

  In support, agents will have to understand customers' pain points completely to provide empathetic personalized solutions and a positive experience. However, at times, agents might find it challenging to comprehend the customer issues and connect with

• BANK FEED - MAYBANK , provider from YODLEE IS NOT WORKING

  As per topic, the provider YODLEE is not working for the BANK FEED. It have been reported since 2023 Q3, and second report on 2023 Q4. now almost end of 2024 Q1, and coming to 2024 Q2. Malaysia Bank Maybank is NOT working. can anyone check on this issue?

• Item images

  Can we get an "On hover" expanded image for items please ?

• Free webinar—Redefining workforce security with Zoho Vault: Passwords, passkeys, and multi-factor authentication

  Hi everyone! Did you know that in Q2 alone, 94 million data records were leaked globally? Behind every breach is a combination of poor password habits, phishing attacks, privilege misuse, and simple human error. The fallout—including reputational damage,

• Zoho Sign product updates - Q3 2025

  Hello everyone! Q3 was all about AI. Here's the list of features and enhancements that have gone live, along with a list of what we have in pipeline for the last quarter: AI-powered agreement management Sending documents and authenticating recipients

• Zoho sites header

  Good day, Im stuck with this situation. I choose a template for my website creation. I have tweaked every instance of the visual editor, regarding the header, I have created created customize fonts presets... I have followed every single step. and my

• Zoho Books Sandbox environment

  Hello. Is there a free sandbox environment for the developers using Zoho Books API? I am working on the Zoho Books add-on and currently not ready to buy a premium service - maybe later when my add-on will start to bring money. Right now I just need a

• Quick Create needs Client Script support

  As per the title. We need client scripts to apply at a Quick Create level. We enforce logic on the form to ensure data quality, automate field values, etc. However, all this is lost when a user attempts a "Quick Create". It is disappointing because, from

• Kaizen #152 - Client Script Support for the new Canvas Record Forms

  Hello everyone! Have you ever wanted to trigger actions on click of a canvas button, icon, or text mandatory forms in Create/Edit and Clone Pages? Have you ever wanted to control how elements behave on the new Canvas Record Forms? This can be achieved

• DNS set up

  I want to create an email with my company domain. When I tried to add new record with cloudflare it didn't work. The DNS record can't be manually added. I followed the instruction but still can't add it. Could you help?

• Pocket from Mozilla is closing shop. Don’t lose your favorites . Move them to Zoho Mail Bookmarks now! 📥🔖

  The end of Pocket shouldn't mean the end of your important links and content. Easily import them into Zoho Mail's Bookmarks and continue right where you left off. You can bring over your entire Saves, Collections, and tags just the way they are. Bookmarks

• General suggestions

  Hello, I've picked this forum as it is at the top of the list! :) First suggestion: A general forum for issues and comments that are not specific to a particular Zoho application. Second suggestion: Put a link on the home page to "Zoho Identity Access Manager" The first suggestion came about because I didn't know where to post the second! ;) Regards Mark

• Can't upload attachments.

  I can't upload attachment in Zoho Mail.

• Need Guidance on SPF Flattening for Zoho Mail Configuration

  Hi everyone, I'm hoping to get some advice on optimizing my SPF record for a Zoho Mail setup. I use Zoho Mail along with several other Zoho services, and as a result, my current SPF record has grown to include multiple include mechanisms. My Cloudflare

• How use

  Good morning sir I tried Zoho Mail

• Zoho Mail Desktop App Not Loading + Can’t Manage Multiple Accounts

  Hi everyone, I’ve been having ongoing issues with the Zoho Mail desktop app for the past few weeks. The app starts to load but gives up midway and never actually opens — there’s no error message, it just stops loading. The main reason I use the desktop

• Error when sending emails from Zoho

  Hello, When trying to send an email from Zoho CRM I keep getting the below error: javax.mail.AuthenticationFailedException: 535 5.7.139 Authentication unsuccessful, the user credentials were incorrect. Any support on this will be much appreciated. Thanks,

• Zoho Tables is now live in Australia & New Zealand!

  Hey everyone! We’ve got some great news to share — Zoho Tables is now officially available in the Australian Data Center serving users across Australia and New Zealand regions! Yes, it took us a bit longer to get here, but this version of Zoho Tables

• Not all emails from outlook365 migrated to my new zoho account

  I recently setup a new email address hosted by zoho. I migrated all my folders and email from my Outlook365 account to my new zoho account, but not all my emails migrated. Looks like only the past 12 months, or so, made the move. How do I get the rest

• Clients not receiving emails

  I've been informed that my emails are not being received. Is there anything that I should look into to rectify this? Many thanks!

• Max numbr of IMAP Accounts in Zoho Mail?

  In Zoho mail, you can manage the inboxes of other accounts using IMAP (and POP, actually) https://www.zoho.com/mail/help/external-imap-accounts.html Is there a max to the number of inboxes we can add?

• Formula Fields Trouble

  Hi,  I can't get even a simple formula field to work and must be doing something dumb. This formula: If(Len(Trim(${Quotes.Subject}))=0,1,2) Gives the error: You used the wrong type of data in an argument. Check what you entered between the parentheses of your functions to make sure you put the right kind of data in the right place. This formula: Len(Trim(${Quotes.Subject}))=0 Gives the error: Syntax Error. Check the examples for any functions you're using to see if you formatted them correctly. Make

• OPTED FOR STORAGE BY DESCRIPTIVE MISGUIDANCE

  We've opened a domain with three mail ids and payment has also been processed now the bill raised is for single use ID with additional storage capacity. Kindly request you to modify the purchase.

• How can I add a new organization on Zoho Campaign

  I want to create a new organization with my Zoho Campaign

• Next Page