Credit to regulars: running a khata
Give credit to trusted customers without the khata quietly eating your working capital.
5 min read
Giving credit to regular customers — writing it in the khata and settling up at the end of the month — is how many neighbourhood shops keep their customers. Done well, it builds loyalty no supermarket can match. Done loosely, it quietly turns your stock into loans you may never get back. Whether you are deciding whether to offer credit or already have a khata full of names, these are the habits that keep it working.
Credit is a loan, so treat it like one
Every rupee in the khata is a rupee you paid your supplier for, sitting in a customer's kitchen. It is part of your working capital, the same as stock. If the khata grows faster than your sales, you will feel it as a shortage of cash to restock, even while the shop looks busy.
Who gets credit
Decide your rules before somebody asks, so saying no is not personal:
- Regulars only. People who have bought from you for a while and you know where they live or work.
- A limit per customer. A maximum amount anyone can owe at once, which you can raise for people who always pay.
- A settling day. Monthly, or when salaries come in. Everyone knows the date.
The customers hardest to say no to are the ones who already owe you the most. Stopping new credit until the old amount is paid is not rude. It is the only thing that keeps one customer's debt from growing until they stop coming in altogether — and take the debt with them.
Keep the khata clearly
Whether it is a notebook or a phone app, each entry needs: date, customer name, what was bought, amount, and a running total. When someone pays, write the payment and the new total the same moment.
Apps that send the customer a message for each entry and each payment remove most disputes, because both sides see the same total all month. If you use a notebook, read out the running total to the customer when you write it.
| Customer | Limit | Owes now | Last paid | Settling day |
|---|---|---|---|---|
| example |
Look at it every week
Once a week, go through the khata and note:
- Total owed across all customers. Is it growing month by month?
- Who is past their settling day.
- Who is near their limit.
Remind people politely on the settling day, and again a few days after. Being consistent makes it feel normal rather than personal — the same idea as the reminder routine in Getting paid on time.
A made-up example: a shop with forty customers on credit has ₹60,000 in the khata at month end. If ten of them settle late by a fortnight each month, the shop is permanently short of the stock that money would have bought. Getting just those ten to settle on time frees the cash without losing anyone.
When someone doesn't pay
Stop further credit, keep selling for cash, and keep asking calmly. Most customers do pay eventually if they are still welcome in the shop. Write off a small amount you will clearly never get, rather than let it sit in the khata making the total look healthier than it is.
Ask the tool below how much credit your shop can afford to carry, with your own sales and khata total.