Facts checked on 27 October 2026. Published by MDG Services on 20 October 2026.
The rule of thumb
Ask: how much diesel does this customer buy from you in one credit period? That is a sensible limit.
Limit = monthly purchase × credit days ÷ 30
It is a rule of thumb, not a law. Your own margin, the customer's other dues and how reliably they have paid you can move it up or down. A new customer starts lower, say at half, and rises after on-time payments. To work it out for one transporter, use the credit limit calculator.
Three worked limits
Example: a made-up business with made-up figures. It is not a real customer.
| Customer | Monthly purchase | Credit days | Working | Limit |
|---|---|---|---|---|
| A transporter buying diesel | Rs 4,50,000 | 15 | 4,50,000 × 15 ÷ 30 | Rs 2,25,000 |
| A contractor whose machines fill at the pump | Rs 3,00,000 | 30 | 3,00,000 × 30 ÷ 30 | Rs 3,00,000 |
| A small bus owner | Rs 1,20,000 | 7 | 1,20,000 × 7 ÷ 30 | Rs 28,000 |
If the bus owner is new, start at half: Rs 14,000.
Credit days and the limit move together
Seven days of credit means a small limit. Thirty days means a large one, for the same buying. Pick the period first, then the limit follows. Fixing 7, 15 or 30 days also tells you when a balance is late: see when to stop credit.
Set it in rupees
The price moves, so a limit in litres drifts. With made-up prices: a limit of 2,500 litres is Rs 2,25,000 when diesel is Rs 90 a litre, but Rs 2,37,500 at Rs 95. The money you have out grew while the limit looked the same. A limit in rupees stays the same.
A good customer a little over
Decide in advance who may allow it: a named manager, never the nozzle man. Write down how much over and why. See what the nozzle man does when a customer is over the limit. To decide who gets a limit at all, see who to give credit to.
Khata Kavach checks the rupee limit you set at the nozzle, with a green, amber or red light. By default, a manager's PIN is needed to go past it. The owner changes a transporter's limit; managers and nozzle men cannot.
Questions people ask
01How much credit should I give a customer?
Start from what he fills in one credit period: monthly purchase × credit days ÷ 30. A new transporter gets less, say half. Raise it once he has paid on time for a few cycles.
02What is the difference between a credit limit and credit days?
The limit is how many rupees a customer may owe at one time. Credit days are how long each fill may stay unpaid. A shorter period means a smaller limit for the same buying.
03Udhar ki limit kitni rakhe?
There is no fixed number. It is your decision. Use the rule of thumb as a start, then ask: could I carry this whole amount if this customer paid a month late?
04Should the limit be in litres or rupees?
Rupees. A limit of 2,500 litres means more rupees owed on the day the price rises. Khata Kavach keeps the limit in rupees and never turns it into litres.
Related pages
About Khata Kavach (advertisement)
Khata Kavach is a shared credit book for petrol pumps, from MDG Services. The transporter asks before each truck fills, your nozzle man sees the limit before he fills, and both of you see every fill, payment and bill. It never lends or holds money.