Glossary · Credit management
Credit application
A credit application is the form a new customer completes to request payment terms, giving the details needed to assess and set up the account.
A credit application collects the customer’s legal name, registration and tax numbers, addresses, contacts in accounts payable, bank and trade references, and the amount of credit requested. It usually includes the customer’s acceptance of your terms of business.
That last part matters most. A signed application that accepts your payment terms, late-payment interest and any collection costs gives you a contract to rely on when an invoice goes unpaid.
It also prevents the commonest invoicing failures: the wrong legal entity, no PO process, and no named person in accounts payable to chase.
Example
A new client signs a credit application naming its AP contact, confirming 30-day terms and accepting interest on late payment. When its first invoice runs late, the supplier knows exactly who to email and on what terms.