Before supplying on credit, confirm the buyer's GSTIN is Active and the name matches the order (a buyer registered in Tamil Nadu has a GSTIN starting 33), read the GST filing record, and check court cases and defaults reported by other suppliers. For spinning and textile mills, also look at court and tribunal cases, which show financial stress early. FundRaksha Trust runs the GST check free and the full buyer report in one place.
How credit works in Coimbatore
Pump and motor makers sell through dealer networks that reach farmers and builders across south and west India, with dealer credit a normal part of the business. Foundries supply castings to pump makers, auto-component units and machinery builders. Textile-machinery makers and spares suppliers sell to spinning mills, whose fortunes follow cotton and yarn prices.
Wet grinder and appliance makers sell through distributors and retailers, much like consumer goods, with festive-season peaks.
Credit risks typical of Coimbatore's trades
- Fast-growing dealer networks where new dealers get credit before they are checked.
- Agricultural seasonality in pump sales, which delays dealer payments after a poor monsoon.
- Spinning mills under stress when yarn prices fall, delaying spares and machinery payments.
- Foundry buyers disputing weights or rejections.
- Appliance distributors returning slow-moving stock.
Checks to run on a buyer
- Validate the GSTIN with the GSTIN validator. A Tamil Nadu registration starts with 33; a different prefix means the buyer is registered in another state, which is fine if it matches the billing address on the order.
- Run the [free Trust check](https://www.trust.fundraksha.com/gst-lookup): status Active, legal and trade name matching the purchase order, registration date and constitution.
- Read the filing record in the Advance GST report (129 RP), which also shows registered contacts, associated people and places, and defaults reported by other suppliers.
- For a larger order, the GST + Financial report (499 RP) adds court cases, tribunals and FIRs and the owner's credit score and loan record, fetched with the owner's consent, and ends in a give-credit, caution or avoid decision.
When appointing a dealer, run the GST + Financial report as part of the appointment, and set a credit limit in the same document as the dealership terms.
Worked example: a pump maker appointing a dealer in Maharashtra
A Coimbatore pump maker is appointing a new dealer in Solapur, who asks for an opening stock of ₹6,00,000 on 60 days. The GSTIN starts 27 (Maharashtra), registered last year. The GST + Financial report shows regular filing and no court cases, a thin owner credit history and no supplier reports: "give credit with care". The maker supplies ₹2,50,000 on 30 days, and the balance of the opening stock against payment.
If a buyer stops paying
Act early. Start with a payment follow-up, then a legal notice by email and WhatsApp or by registered post with proof of delivery. For a bounced cheque, the Section 138 notice must go within 30 days of the return memo.
A micro or small supplier with Udyam registration located in Tamil Nadu can file on MSME Samadhaan before the Tamil Nadu Micro and Small Enterprises Facilitation Council (Commissionerate of Industries and Commerce (MSME Department), Government of Tamil Nadu, Chennai) once the buyer is past the agreed period, which the MSMED Act caps at 45 days. Interest runs at three times the RBI bank rate, compounded monthly.
Report the defaulter so other suppliers are warned, and for recovery help in the city see FundRaksha Coimbatore.
Sources
Last reviewed: 2026-10-21. Information for Indian businesses; not legal advice.