Low customer score

A low customer score indicates that a customer poses a high risk: weak creditworthiness, significant or repeated late payments, or broken promises.

Example

A customer’s credit rating drops from 7 to 3 out of 10 in three months. The company reduces the customer’s credit limit, steps up collection efforts, and checks whether the customer is covered by credit insurance.

Why It’s Important

A declining credit score is a warning sign that should be taken seriously before a payment goes unpaid. It allows you to take action early: make a down payment, shorten the payment term, or provide collateral.

For more information: Customer Risk Management.

See also: high-risk customer, customer risk, credit limit.