AI agents for business finance: what they can and can't do
What AI agents can do in bookkeeping, close, collections and compliance today, where a person must stay in charge, and how to judge a product.
The short answer
Sell on credit only if the extra sales are worth more than the cash you tie up and the debts you may lose. Put it in a short written credit policy: who qualifies, a starting limit per customer, payment terms, what security you take, what happens when a payment is late, and how often limits are reviewed.
In Nigerian trade, "bring the money later" is a normal request. Distributors give retailers stock on credit, schools let parents pay in instalments, contractors wait for their certificates. Credit wins customers, but every naira on credit is a naira you cannot use to restock or pay staff. A written policy turns a series of favours into a business decision.
First decide whether credit is worth it
Ask three questions before you offer terms to anyone:
- Will credit bring sales you would otherwise lose? If customers already pay cash, credit only slows your money down.
- Can you fund the gap? Work out how much cash you would have locked up in debtors at any time, and whether you can still pay suppliers.
- Can you absorb a bad debt? If one customer failing to pay would sink you, keep credit small and secured.
Worked example
Example: a provisions wholesaler sells ₦6,000,000 a month, all cash. Offering 30-day terms to its best retailers would add ₦1,500,000 of monthly sales at a 12% margin, which is ₦180,000 extra gross profit a month. But if half of all sales move to credit, about ₦3,750,000 (half of the new ₦7,500,000 monthly total) is always owed to it. If one retailer owing ₦400,000 defaults, that wipes out more than two months of the extra profit. The policy needs limits that keep any one loss small.
What a credit policy should say
| Section | What to write | Example wording |
|---|---|---|
| Who qualifies | Minimum trading history, documents and checks | Six months of cash purchases, CAC search, two references |
| Starting limit | Maximum owed at any time for a new account | Example: no more than one month of their average cash purchases |
| Terms | When payment is due and how | 30 days from invoice date, by transfer to the business account only |
| Security | Guarantee, post-dated cheque, deposit or none | Personal guarantee from the owner above a set limit |
| Late payment | Steps and when supplies stop | Reminder at day 3, call at day 7, account on hold at day 15 |
| Review | How often limits change | Every quarter, raise only after on-time payment |
| Authority | Who can approve credit and exceptions | Owner approves anything above the standard limit |
Checking a customer before you give credit
- Confirm the business exists on the CAC public search and the name matches the person you are dealing with.
- Ask for a written application with the owner's ID, address and phone, signed.
- Speak to other suppliers who give them credit.
- Start small: a limit based on their cash buying history, not on what they ask for.
- Agree terms in writing before the first delivery; an exchange of emails or WhatsApp messages is better than nothing, but a signed form is clearer.
Credit bureau reports are mainly a tool for banks and licensed lenders. For trade credit, your own records of how a customer has paid you, plus references from their other suppliers, are usually the best guide.
Guarantees and other security
For larger limits, a personal guarantee from the owner of a limited company gives you someone to pursue if the company fails. Some suppliers take post-dated cheques as security. Be careful: a post-dated cheque cannot be presented before its date, and the Dishonoured Cheques (Offences) Act covers cheques presented within three months of their date, so a cheque dated far ahead gives weaker protection. A deposit on each order, or holding title until payment, are other options. See post-dated cheques.
Running the policy
A policy only works if someone runs it every week. Keep an aged debtors list (current, 1 to 30 days late, 31 to 60, over 60). Stop new credit when an account goes past your hold point, even for a good customer. Chase on a schedule, as in our invoice reminder schedule. For debts that stall, small claims courts are designed for small traders: in Lagos, the Small Claims Court handles liquidated money claims up to ₦5,000,000 and expects a letter of demand first. Our guide to cash flow for small businesses shows how debtors fit into the wider plan.
Signs a customer is in trouble
- Payments start arriving later each month
- Part payments with no explanation
- Requests for a higher limit just as payments slow
- Change of phone number or premises without notice
A one-page policy you can adapt
Keep the written version short enough that staff actually read it. A sample, to edit for your trade:
- Credit is offered only to customers who have bought for cash from us for at least six months and have completed our credit application form.
- New credit accounts start at a limit set by the owner, based on the customer's average monthly cash purchases.
- Invoices are due 30 days from the invoice date and are paid by transfer to our business account only. Cash handed to staff does not settle an account.
- Accounts more than 15 days overdue are placed on hold: no new deliveries until the overdue amount is paid.
- Limits are reviewed every quarter. Any exception to this policy is approved in writing by the owner.
Give the customer a copy with their first credit invoice and keep their signed acknowledgement. When a dispute arises months later, that page is what settles who agreed to what.
Where Pryme fits
With a Pryme Business Account you can send invoices with payment details in your business name, and the Sales agent can prepare reminders for you to approve before they go out.
Questions people ask
Should a small business give customers goods on credit?
Only if the extra sales outweigh the cash tied up and the risk of bad debts. Set limits and terms in writing and start small.
How do I set a credit limit for a customer?
Base it on their cash purchase history, for example no more than one month of average purchases, and raise it only after they pay on time.
Is a post-dated cheque good security in Nigeria?
It is weak security. It cannot be presented early, and the Dishonoured Cheques Act covers cheques presented within three months of their date.
What can I do if a credit customer refuses to pay?
Send a written demand and, for sums up to ₦5 million in Lagos, consider the Small Claims Court. Stop further supplies until the account is settled.
Sources
- Legit.ng: How to verify a CAC certificate online (11 Sep 2026) · accessed Oct 2026
- Dishonoured Cheques (Offences) Act, Laws of the Federation (PLAC) · accessed Oct 2026
- Lagos State Small Claims Court Practice Directions (Lagos MEPB, Dec 2025 file) · accessed Oct 2026
This article is general information, not financial, legal or tax advice. Products described are provided under the terms on this site and are subject to regulation and eligibility.