What policies do companies use to decide which customers to offer credit to?

Companies typically use a combination of credit scoring models, which assess an individual's credit history, income, and existing debt levels, to evaluate creditworthiness. They may also consider factors such as employment stability, payment history, and overall financial behavior. Additionally, companies often implement risk thresholds and guidelines that align with their overall business strategy and risk appetite. These policies help ensure that credit is extended to customers who are likely to repay their debts.