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A Credit Policy sets clear rules for how a Belgian company handles customer credit and manages payment risks. It spells out who can get credit, how much they can receive, and what happens when payments are late. This framework helps businesses comply with Belgian financial regulations while protecting their cash flow.

The policy typically includes credit assessment methods, payment terms, and collection procedures aligned with Belgium's B2B payment laws. It guides credit managers through decisions about credit limits, required guarantees, and necessary actions for overdue accounts. Having this policy helps organizations make consistent credit decisions and maintain healthy business relationships.

Implement a Credit Policy when your Belgian business starts offering payment terms to customers or sees increasing payment delays. This becomes essential as your client base grows and you need standardized ways to evaluate creditworthiness, set payment terms, and handle collections.

A formal policy proves particularly valuable during economic downturns when payment risks increase. It helps protect your business under Belgian financial regulations, especially when dealing with new customers or expanding credit lines. The policy becomes your guide for managing credit decisions consistently and defending against payment defaults while maintaining good customer relationships.

• Basic Credit Policies focus on standard payment terms and credit limits for typical B2B transactions in Belgium
• Industry-Specific Policies adapt credit rules for sectors like construction or retail, reflecting unique payment cycles and risks
• Enterprise-Level Policies include detailed scoring systems, credit committees, and multi-tier approval processes
• International Trade Policies address cross-border transactions, EU regulations, and currency risk management
• Collections-Focused Policies emphasize debt recovery procedures, late payment penalties, and legal enforcement steps under Belgian law

• Finance Directors: Set overall credit strategy and risk tolerance levels for the organization
• Credit Managers: Handle day-to-day implementation, evaluate credit applications, and monitor compliance
• Sales Teams: Must understand and work within credit limits when negotiating with customers
• Legal Counsel: Review policy compliance with Belgian financial regulations and debt collection laws
• Business Customers: Subject to credit evaluations and must comply with payment terms
• External Auditors: Assess policy effectiveness and compliance during financial reviews

• Business Profile: Document your company's credit needs, customer types, and typical transaction values
• Risk Assessment: Map out your risk tolerance levels and past payment default experiences
• Legal Requirements: Review Belgian financial regulations on payment terms and debt collection procedures
• Credit Limits: Define your evaluation criteria, scoring system, and approval thresholds
• Collection Process: Outline steps for payment reminders, late fees, and enforcement actions
• Internal Controls: Establish approval workflows, documentation requirements, and review schedules
• Review Process: Set up regular policy evaluation periods to keep current with market conditions

• Scope Statement: Clear definition of which transactions and customers the policy covers
• Credit Assessment Criteria: Detailed evaluation methods and required documentation from customers
• Payment Terms: Specific conditions aligned with Belgian B2B payment legislation
• Default Procedures: Steps for handling late payments under Belgian debt collection laws
• Data Protection: GDPR-compliant procedures for handling customer financial information
• Approval Authority: Clear delegation of credit decision-making powers
• Review Process: Scheduled policy review dates and amendment procedures
• Governing Law: Express reference to Belgian commercial law jurisdiction

A Credit Policy often gets confused with a Letter of Credit, but they serve distinct purposes in Belgian business transactions. While both deal with credit arrangements, they function quite differently in practice.

• Scope and Purpose: A Credit Policy provides internal guidelines for managing all customer credit relationships, while a Letter of Credit is a specific bank guarantee for a single transaction
• Legal Standing: Credit Policies are internal governance documents that guide decision-making, whereas Letters of Credit are legally binding payment guarantees between banks
• Duration: Credit Policies remain active indefinitely with periodic updates, while Letters of Credit typically expire after a specific transaction completes
• Parties Involved: Credit Policies involve the company and its customers directly, while Letters of Credit require bank involvement as intermediaries