The customer card in Microsoft Dynamics 365 Business Central holds a number of fields that the finance department uses to control credit, payments, reminders, and posting. This article walks through the fields that matter for finance, so you know where to set the credit limit, how to block a customer, and how to control payment terms, reminders, and finance charges.
The credit limit field on the General tab sets the maximum amount the customer can exceed their payment balance before the system warns you when creating new orders. You do not get a hard stop, just a warning.
You can block a customer for shipment, for invoicing, or for both, which is useful when you are having trouble collecting payment.
The posting groups (general business posting group, VAT posting group, and customer posting group) determine how transactions for the customer are posted.
Payment terms, payment method, reminder terms, and finance charge terms are all controlled through codes on the customer card that point to setup tables. If the reminder terms code is blank, no reminders are created for that customer.
Credit limit on the customer card
The first field on the General tab relevant to finance is the credit limit in local currency. This specifies the maximum amount the customer can exceed their payment balance before the system gives you a warning. The warning appears when you create new orders for the customer, so the finance department gets a heads-up rather than a hard block.
Blocking a customer for shipment or invoicing
If you are having trouble collecting money from a customer, the finance department can block them. You have three options. You can block the customer for shipment, for invoicing, or for both. This gives you flexibility depending on how far you want to restrict the customer’s activity.
VAT registration number and global location number
Under invoicing, the VAT registration number field holds the customer’s VAT registration number.
The global location number (GLN) is used when sending electronic documents to the customer.
Posting groups for the customer
The posting details are also important to the finance department. Here you define three posting groups for the customer:
- The general business posting group
- The VAT posting group
- The customer posting group
These groups control how transactions for the customer are posted to the general ledger.
Prepayments and payment application method
The Payments section is another area the finance department cares about.
In prepayments, you define whether the customer should prepay a certain percentage of their orders before you ship them.
The application method controls how payments are applied to entries. You can apply payments manually, or you can set the system to apply to the oldest entry automatically.
Payment terms and payment method
The payment terms code defines when payments are due. These terms are configured in the payment terms list.
The payment method code defines how the customer should pay. This is set up in the payment method code table.
Reminder terms and finance charge terms
The reminder terms code defines how reminders are calculated for the customer, including the due dates, the grace periods, and the text that appears on the reminder. These are set up in the reminder terms table.
If the reminder terms code is left blank, no reminders will be created for that customer. This is worth checking if you expect reminders but none are being generated.
Finally, the finance charge terms code defines how finance charges are calculated. These are defined in the finance charge terms code table.
Q&A
What does the credit limit field on the customer card do?
It specifies the maximum amount the customer can exceed their payment balance before the system warns you. The warning appears when you create new orders for the customer. It is a warning, not a hard block.
How do you block a customer in Business Central?
You can block a customer for shipment, for invoicing, or for both. The finance department typically does this when there are problems collecting payment.
What is the global location number used for?
The global location number (GLN) is used in electronic document sending.
Why are no reminders being created for a customer?
If the reminder terms code on the customer card is blank, no reminders will be created for that customer. Set a reminder terms code to enable reminders.
What is the difference between application methods for payments?
The application method controls how payments are applied to entries. You can apply payments manually, or set the system to apply them to the oldest entry automatically.
Where are payment terms and payment methods set up?
Payment terms are configured in the payment terms list, and payment methods are set up in the payment method code table. You then assign the relevant code on the customer card.