What Does Credit Terms Mean?
Credit terms lay out the timing and terms for customer payments.
How it Works
A business will make sales on a credit basis.
This means, the business allows customers time to pay for the goods and services they have bought.
Payment details will be set out in the credit terms, shown on each invoice issued.
Payment terms may stipulate a simple net term.
This sets out when payment is due.
Alternatively, the credit terms may include a special clause.
In other words, it will set out an incentive offer for paying early.
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