What is the CheckRate Company or Business Credit Limit?
The company credit limit is the recommended total amount that should not be exceed in the extension of credit at any one time to the company or business in question.
The score is calculated using many of the same data fields as the Credit Rating Risk Score and is calculated in conjunction with the Risk Score.
These fields include:
- Debtors & Cash (where avaialble)
- Turnover (where available
- Net Worth
- Working Capital
- Net Cash Flow Operations
- Shareholder Fund
If a company has a positive rating the credit limit would use the above fields to calcualte the amount of credit that can be extened at anyone time. If there is a negative rating then there usually would not be any limit. If the Company has High Value figures in the above Fields then it is likely to have much larger Credit Limits than Companies with low (or negative) figures in the above fields. The financial items used are fairly standard for credit limit assessments.
