Trends and challenges for credit management in 2025

It is clear that many organisations are struggling to keep control over their payment processes. Indeed, the majority (58%) struggle with a DSO of over 30 days. And there is hardly any optimism regarding improvement: 57 percent expect no change by 2025, and 18 percent even expect the DSO to increase this year But why can’t customers pay their bills on time? A third of finance professionals (30%) attribute this to the changing economic landscape. But there are also other reasons why customers do not pay invoices (on time):

Rising DSO is not without consequences. A quarter of finance professionals (25%) note the necessity for internal cost-cutting measures, and 20 percent say that reorganisations were required to reduce costs. Moreover, the prevailing economic pressures are leading to a rise in customer bankruptcies: 18 percent of finance professionals see this number increasing. Furthermore, organisations face other consequences if they fail to ensure timely invoice payments. For example, 27 percent of finance professionals highlighted the risk of compromising their organisation’s financial stability. Likewise, 22 percent indicate that not taking action could lead to additional costs, such as external funding to maintain cash flow. In short: a rising DSO not only affects the balance sheet but also works its way to the core of the organisation.

Organisations are reaching for concrete solutions to deal with these risks. And these solutions do highlight the importance of a good credit management policy: 77 percent of finance professionals recognise it has a major (or even the biggest) impact on their organisation’s financial health. Many organisations adopt a personalised approach to ensure customers pay
The high use of factoring in the second spot is striking. In fact, this is a measure that temporarily improves liquidity but does not address the underlying causes of high DSO. Meanwhile, one-fifth of respondents (22%) also offer customers a wide range of online payment options, while almost 40 percent of organisations are expanding their current offerings for customers with payment problems. In light of the growing number of bankruptcies, 35 percent of organisations are also focusing more on their customers’ DSO.

Although organisations claim they are taking steps to encourage timely payments, 63 percent have not taken steps to improve their credit management policies in the past 12 months. This is also reflected in the use of outdated systems: more than a quarter of organisations (29%) still rely on Excel or Google Sheets. These tools offer limited opportunities for automation, signalling and follow-up, making the handling of late payments less effective

Despite the stumbling blocks mentioned, some organisations are actually taking steps. 56 percent of organisations regularly evaluate the effectiveness of their credit management policies, and 48 percent work with an adapted procedure for regular customers. Additionally, more measures are being adopted to enhance credit management:

While organisations are well aware of the risk of rising DSOs, structural action remains limited. Instead, reliance on outdated tools and temporary solutions, such as factoring, is growing. True solutions lie in lasting improvements: technology, automation and real-time data can greatly enhance and futureproof credit management processes. For organisations aiming to strengthen their financial health and be prepared for economic uncertainty, now is the time to implement structural improvements. Don’t wait until it is too late. However, there is often a lack of the clear insight needed for effective improvement. How can we get started? A strategic starting point for today is to conduct a baseline assessment. Get a clear picture of where delays occur, which customers or invoices cause structural concerns and where internal systems fail. Armed with this kind of knowledge, you can take targeted action and make structural improvements. Now and in the future.