There’s nothing worse in business than a customer who refuses to pay. It’s almost a rite of passage. One service is using data to spot non-payers before you make the sale.
CreditorWatch collects information from the Australian Securities and Investments Commission, the Australian Business Registry, court judgements and its own database to identify problem payers.
The service is five years old and has 25,000 customers who pay subscriptions from A$29 a month. In November CreditorWatch launched an integration with Xero that scans its receivable data. It then displays information about the debtor such as the number of outstanding invoices and how fast they pay you.
CreditorWatch also recently integrated with MYOB Essentials and plans to connect to MYOB AccountRight Live next.
If a business hasn’t paid a Creditorwatch user can register a default which will be applied to the customer’s credit file. Anyone performing a credit check will be able to see it.
When the customer has a fault or a court judgement against it all CreditWatch users that deal with the customer are alerted. They also receive alerts when a company goes into administration or has a winding up notice from ASIC.
The extra information about customers can help a business decide whether it’s wise to open an account for the customer that they can pay by monthly invoice. These terms could be included on invoices; the best payers have longer terms compared to the poor payers.
Managing director Colin Porter was sick of chasing advertisers when he ran a publishing business for 15 years. “They wouldn’t pay their bills and then I’d see them pop up in other magazines,” he says.
Credit checks are dominated by two companies, Veda and Dun & Bradstreet which target the corporate market. Instead of charging A$50-$60 for a report, CreditorWatch users pay a monthly subscription (A$29-A$59) to access 40 to 300 customers a month.
“We’re targeting small business owners who have no experience in credit. It could be a tradie doing their accounts on the weekend,” says Colin Porter, managing director. “We make it as simple as possible and provide recommendations and debt collection tools.”