Depending on the age of the borrower, the average debt for an Indian family might range from tens to hundreds or thousands of rupees.
And in those cases, you may try to negotiate a lower payment with your creditors through a procedure called the “debt settlement process“.
Even though this option is not without hazards, it may bring some positive outcomes for some people, while for others it may feel like a nightmare.
So to discover what it is all about or how the debt settlement process actually works, keep your eyes on the following section.
What Do You Mean By Debt Settlement?
When both parties agree to settle a debt for less than the full amount owed and make a commitment to pay off the lower total in full, this is called a debt settlement.
In order to negotiate late payment solutions with their unsecured creditors for less than they are owed, debt settlement agencies deal directly with clients with financial difficulties.
Debt settlement, also known as debt relief or debt adjustment, is typically handled by a renowned third-party company like CreditQ, which are pro in the field.
Not all creditors will agree to a debt settlement process, and if they don’t, it could do more harm to your finances than good.
Furthermore, handling debt settlement on your own is not recommended as it can be a lengthy and complex process.
How Does Debt Settlement Affect a Business Credit?
Before you opt for debt settlement, it is highly recommended that you consider the tips for debtor management.
This is because the debt settlement process can have a significant impact on your business. In other words, it can lower your credit score by over 100 points and is reported to the credit bureaus for a period of seven years.
Your credit utilisation may rise as a result of the closure of accounts by your creditors as part of the settlement procedure, which can be bad for your credit score.
But relying on service providers like CreditQ can be helpful as we assist in unblocking the dues in MSME and other business sectors by implementing strategies that increase cash flow efficiently.
How CreditQ Turns Out As A Helping Hand?
CreditQ is a web-based credit management application that helps organizations monitor and better handle their B2B credit risk management tasks efficiently.
Relying on CreditQ makes it easier to implement efficient Credit Management Techniques through seamless access to up-to-date information regarding the credit report of the MSME alongside other business sectors. When you choose us as your business credit management partner, you receive invaluable tips for Debtor Management alongside a top-class service.
You may boost your Business Credit Report through the help of our specialized tool and expert guidance. Other than that, you can reward the vendors and customers who are crucial to your company’s success by keeping tabs on their performance ratings and giving them either positive or corrective feedback.
Get in touch with us to deal with your late payment solution , and we will have one of our experts explain the process and help you figure out how to catch up on your overdue bills.