Third-Party Credit X Own Credit

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What are your questions about credit? Are you looking for more knowledge to apply the best services for your business? You are on the right track!

First of all, when a client comes to me to learn more about the credit system, a very common question that arises is regarding the difference between THIRD-PARTY CREDIT and OWN CREDIT? Do you already know what differentiates each of these credit models?

If you have a business with credit, it is essential that you vnpay database understand more about this subject, even to know what the best move to make is. And this article will help.

Are you interested in learning more about this? Continue reading to check out all the information.

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WHAT IS THE DIFFERENCE BETWEEN THIRD-PARTY AND OWN CREDIT?
Don't worry, this is a very common question among store owners. In a simplified way, we can explain each of these types of credit as follows:

WHAT IS THIRD-PARTY CREDIT?

Third-party credit is an excellent solution for those who want to sell on credit without relying on a credit card and, most importantly, without having to risk the store's cash flow .

It is usually recommended according to the number of customers you have in your store, because when you reach a higher number of sales, using a financing company to make the outsourced credit becomes more worthwhile. So it depends.

In other words, when the business is still small, its own credit system works well, as long as the store invests in credit analysis and collections. However, as the business expands and the number of customers increases, the demand for credit also increases. When we reach this point, it is interesting for the company that works with its own credit system to review these issues and seek different resources to finance its consumers.

WHAT IS OWN CREDIT?
A Credit System is nothing more than a form of credit that is fully linked to the business. In other words, it is an option that allows you to pay for your sales in installments. However, you are the one who manages and finances this with your store's own resources.

With your own credit plan, you are 100% responsible for your customer. This is usually interesting because it is a way to make your customers return to your store every month to pay the installment and, if they are late on any installment, the interest and fines will go directly to your own cash flow. In the initial phase of the business, it is a great option.



HOW TO MAKE THE MOVE FROM OUTSOURCED TO OWN WORK?
I always like to explain to my clients that Third-Party Credit should only be used in times of need. After all, with your own Credit, you have fewer expenses and make more profit from late payments and interest. That's why many people come to me to find out how to make the best move to return to your own Credit.

Generally, entrepreneurs who want to migrate to the Own Credit model make this choice when they realize that the operation did not run as they imagined or that customer approvals were greatly reduced and there was a loss of financial income.

The Role of the Concession Analysis Tool
For these and many other reasons, it is common to want to bring the credit operation back in-house. To do this safely, there are some points that need to be analyzed so that this entire process occurs in the best possible way: