Credit Guardian provides both a Credit Rating and Credit Limit on each monitored company. What is the difference between these two important pieces of data?

The Credit Rating represents the maximum amount of sales a customer should place with you over a 30 day period.

The Credit Limit represents the maximum amount of money an account should owe you at any one point in time. 

The Credit Limit is set at a maximum of 3 times the Credit Rating and decreases the differential between the Credit Limit and Credit Rating as the level of risk increases. 

Credit Ratings and Credit Limits are given to allow the account to make second or subsquent purchases before the first purchase is due for payment.

An account has a Credit Rating of £1,200 and a Credit Limit of £3,600.

• Month 1 they spend their maximum allowed £1,200, so they owe £1,200
• Month 2 they spend their maximum allowed £1,200, so they owe £2,400
• Month 3 they spend their maximum allowed £1,200, so they owe £3,600

Without paying anything they are now at their Credit Limit and you should stop supply.