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Home » Business Credit Glossary » Credit Limit Recommendation
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Credit Limit Recommendation
The Credit Limit Recommendation provides two suggestions as to the amount of credit a business may receive:
- Conservative Limit- a dollar benchmark if your policy is to extend less credit to minimize risk
- Agressive Limit- a dollar benchmark if your policy is to extend more credit with potentially more risk
These recommendations are made based upon the size of business, industry, and likelihood of slow payments or financial distress.
Recommended limits are useful when dealing with a new customer or prospect with whom you do not have a previously established credit record.
