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ULB 1153 Lesson NotesUNITAR

intellectual property of RMY

Name : _____________________________ ID : ________________ Date : ______________

Lesson 7Chapter 2 Types of Business Writing (Subtopic 3)

Credit Application & Reply

APPLICATION FOR CREDIT

letters requesting for credit is written when a buyer wishes to buy goods over aperiod of time on credit and then pay for them at a later date.

payments are usually made half yearly, quarterly or monthly which makes businessdealing convenient to both retailers and consumers

a request for deferment of payment is made if a buyer is unable to pay for goods

supplied due to financial difficulties and therefore requests a postponement forpayments

PLAN OF A LETTERREQUESTING CREDIT FACILITIES / DEFERMENT OF PAYMENT

Mention the good business dealings in the past.

State the intention to continue business dealings.

Request for credit / deferment of payment

Give the reason for your request. State your terms of payment. End with a statement of appreciation.

Sample 1Request for credit facilities

Sample 2Request to defer payment

Dear Sir

Request for Credit Facilities

We are extremely satisfied with the

services you have provided for ourpast orders and we assure you therewill be an increase in our orders inthe future.

As our business dealings haveincreased considerably over the lasttwo years, we would be glad if youcould grant us credit facilities. We

propose to make payments atquarterly intervals.

Yours faithfully

Dear Sir

Request to Defer Payment (Invoice No: 733)

Thank you for your statement of 11 September

2001. The amount RM560.00 outstanding iscorrect.

We have always met our financial commitmentsin the last few years. However, due to certainfinancial difficulties, we wish to defer oursettlement until next month. This would enableus to cope with the difficult situation at themoment.

We look forward to your favourable reply soon.

Yours faithfully

Possible expressions used in credit application1. Openings

As our business relations with you have always been especially good, we intend toincrease our orders in the future.

We are extremely satisfied with the standard of your service shown to us in the past.

Thank you for your letter of 11 September, 2001 reminding us of the outstandingsum of RM2200.00.

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2. Requesting for Credit / Deferment of Payment

Due to our long-standing business links, we wish to request credit facilities on ourfuture orders.

We had intended to settle our outstanding account of RM3,400.00 but due to therecession we are compelled to request for a deferment of payment.

We should be glad if you would grant us credit facilities / a deferment of payment.

3. Endings We propose to make payments at quarterly intervals.

We would greatly appreciate the credit facilities provided, since it would help us tocope with the present volume of business.

We look forward to receiving a favourable reply.

Error DetectionLanguage PracticeIdentify and correct 10 errors in the following letterFor this exercise, Ive highlighted the errors just to help you out a bit, okay.

Error CorrectionDear Sir

Invoice No: 711

We receive your statement yesterday. As

you know we have always settle ouraccount promptly, and regrets that we nowfound it necessary to ask you of an extrathree (3) weeks to clarify this account.

Our difficulty are temporarily and weexpected to be able to settle in full withinthree weeks.

Yours faithfully

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WRITING PRACTICE

You are a retailer selling greeting cards. You require credit facilities to ease your cash-flow problems. Write to the Manager of Momento Enterprise, your supplier, asking him toconsider your situation. Write a letter with relevant details and state your terms ofpayment.

REPLIES TO CREDIT APPLICATION

a firm can provide favourable replies to request for credit facilities/deferment ofpayment if the client is known to have good business relations and makes promptpayments.

A firm can, however, decline these requests if the client is known for not makingprompt payments. A request may also not be entertained if the firm is not able, forsome reason, to provide such facilities. It may be because of a change in company

policy or an unfavourable business climate.

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PLAN OF FAVOURABLE REPLIES PLAN OF UNFAVOURABLE REPLY

Acknowledge the request. State that you are pleased to grant his

request.

State the settlement period / settlementdate you would allow.

Hope for continued good business

relations.

Acknowledge the request. Regret that you have to decline the

request.

Provide a suitable reason.

Hope that he will understand yourreason/reasons.

Hope that your business relations willnot be adversely affected.

Sample 1Favourable Reply to a Request forCredit Facilities

Sample 2Favourable Reply to a Request forPayment Deferment

Dear Sir

Request for Credit Facilities

Thank you for your letter of 11 November2002 requesting credit facilities for your

orders.

As our business relations have beensatisfactory over the past two years, we arepleased to grant you the convenience oncondition that a 90- day settlement periodis maintained.

You can be assured that you will receive ahigh standard of service as in the past.

Yours faithfully

Dear Sir

Request to Defer Payment

Thank you for your letter of 21 October2002 requesting to defer payment. Due to

the special circumstances you havementioned, we are prepared to allow you todefer your payment until next month.

We would be most grateful if you couldarrange for the settlement of the amountdue by 12 December 2002.

We hope this will help your situation.

Yours faithfully

Sample 3Unfavourable Reply to a Request forCredit Facilities

Sample 4Unfavourable Reply to a Request forPayment Deferment

Dear Sir

Thank you for your letter dated 10 October

2002 requesting credit facilities from us.

We have fully considered yourcircumstances, but we regret we have todecline the request since we are currently

facing a depressed business climate. Wehope you will understand our position.

We look forward to having further businessdealings with you and assure you of ourcontinued efforts to serve you.

Yours faithfully

Dear Sir

We have received your letter dated 11

November 2000 requesting a deferment ofpayment on the amount due on ourNovember 2 statement.

We have given every consideration to your

difficulties but unfortunately companypolicy does not allow us to provide suchconcessions at present. However, with an

improvement in our business, we couldoffer you a reasonable deal in the future.

We look forward to more business dealingswith you.

Yours faithfully

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Possible Expressions used in Replies to Credit Application

Introductory Expressions

1. Thank you for your letter of requesting credit facilities from us/a deferment ofpayment.2. We have received your letter requesting credit facilities/a deferment of payment.

3. We would like to thank you for your letter requesting credit facilities/a deferment ofpayment.

Granting the Request

1. Your request for credit facilities / a deferment of payment is being considered.2. We are willing to consider your request for credit.

3. We are most willing to grant you the credit facilities/ a deferment of paymentconsidering our fine business relations.4. We will not hesitate to offer you credit on your future orders since our businessrelations have always been good.5. We are willing to grant your request on condition that ...

6. Due to the special circumstances, we are prepared to allow you to defer paymentuntil...

Declining the Request

1. Unfortunately we are unable to grant you credit facilities/a deferment of payment dueto the current business slowdown.

2. We regret that our current policy does not allow us to offer credit due to our decliningbusiness performance.3. Although we have fully considered the matter, we cannot provide credit facilities/adeferment of payment due to the present economic climate.

Concluding Expressions for Favourable Replies

1. We would appreciate your prompt payments every month(s) and look forward to

further business dealings with you.2. Kindly make your payments promptly.

3. We would be grateful if you would make your quarterly payments promptly.4. We hope you will find the terms satisfactory.5. We assure you of our continued good service.

Concluding Expressions for Unfavourable Replies

1. We hope that this will not affect our business relations and we look forward to havingfurther business dealings with you.

2. We sincerely hope our business relations will be maintained in the coming years.

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Exercises

Fill in the blanks with appropriate answers.

1. Thank you for your letter of 11 November ________ credit.2. We _____ you for your letter of 4 January _____ a deferment in payment.3. We are _____ this request solely to enable you to _____ with the present unfavourable

circumstances.4. Considering the recovery in the economy, we have _____ to provide you this service.5. We _____ to inform you that your _____ for a deferment of payment has beenrefused.6. We have no wish to _____ our business relations, but we have to _____ your request.

7. We have _____ every angle of the problem but our _____ is still to refuse yourapplication for credit.

8. We _____ you of our continued efforts to provide you good _____.9. We hope you will _____ our reason for declining your request for a _____ of payment.10. Kindly _____ payments promptly as this would assist us in _____ your orders

There are 10 errors in the letter. Identify the errors and correct them.

Error CorrectionDear Sir

Thank you for your enquiry for credit. Wehave consider your circumstances.

As our business relations has beensatisfaction over the past two years wewould be glad to granted you the request.We have agreeing to quarterly payments ifthis are made prompt.

You can be assure of our continue efforts toprovides you good service.

Yours faithfully

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The End

This is our last lesson for this semester. Good Luck in your exams and All the Best in your positive futureendeavours (if youre planning something illegal, I dont want to wish you the best in it

Hope you will all take the final exam as scheduled. Please do not even consider taking the Special Exam unlessyour hands and fingers are badly broken and you cannot write at all. Please have the proper attitude and beresponsible. Thanks.

L7C2-130707_081749

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