N. Making Credit Decisions


The basic objective in making credit decisions is to find ways to approve an order with reasonable expectation that the customer will pay in accordance with established credit terms. A decision to grant or not to grant credit affects sales revenue, profit, production and procurement. If the customer is a good credit risk, the order may be approved as submitted. Otherwise, alternatives should be developed that are acceptable to the credit department and the sales department—and still meet the customer’s needs.

It is desirable to establish routine procedures for making most credit decisions. Credit approval, through the use of order limits or overall credit limits, can streamline the workload in the credit department. The goal is to approve credit with minimum delay, provide customers with prompt service and control administrative costs. If routine orders can be processed quickly and efficiently, the credit professional has additional time to devote to more demanding credit matters. This module discusses approaches and decision factors associated with making credit decisions with speed, accuracy and efficiency. 

After viewing this module, students should understand: 

Module Outline: 

  • Approval of credit for new customers.
  • Establishing credit limits for customers.
  • Available security devices.
  • How credit scoring is used to help manage credit.
  • Credit approval for marginal credit accounts.
  • Making credit decisions using limited customer information.
  • Conducting review of credit limits.
  1. Accounts for New Customers
  2. Credit Availability and Limits for New/Existing/Repeat Customers
  3. Handling Marginal Business
  4. Decisions Based on Limited Information
  5. Review of Credit Limits


Speaker Bio:
Toni Drake brings over 30 years of oil and gas credit experience to the table. Toni holds a CCE, NACM’s most prestigious designation. After earning her CCE, she went on to attend and excel at NACM’s Graduate School of Credit and Financial Management to further her education in the field of credit. Toni continues to support the credit profession as a speaker and instructor at events like NACM’s annual Credit Congress.


Open to view video.
Open to view video.
Quiz Attempt 1
10 Questions
10 Questions This is your first of 2 quiz attempts. If you pass, you can proceed to earn your credit. If you fail, you can proceed to Quiz Attempt 2.
Quiz Attempt 2
10 Questions
10 Questions This is your last quiz attempt. If you pass, you can proceed to earn your credit. If you fail, please contact education_info@nacm.org.
0.10 CEU credits  |  Certificate available
0.10 CEU credits  |  Certificate available