Tips for Managing Credit & Risk Trading​

A cash reserve protects you against short-term issues such as a drop in sales or an unexpected expense and allows you to seize opportunities as they arise. This article answers the question “What is cash reserve?” and shares tips on how to build and manage yours.

Today, trade credit is an essential tool for companies wishing to conquer new markets and build a long-term commercial relationship. Indispensable in certain sectors such as distribution or construction, trade credit does involve various risks, but there are ways to control them effectively.

While trade credit is a powerful commercial tool for conquering new markets and building customer loyalty, it is also a double-edged sword that can weigh on your working capital and cash flow. As part of your cash flow management strategy, trade credit insurance can help you control this credit risk.

Trade credit is a commercial weapon that must be handled with care in order to protect your cash flow. Taking out a trade credit insurance policy remains the most efficient way to manage your trade credit risk. But it is not always easy to choose the right provider and find a reliable partner with the necessary experience to manage risky situations and support your commercial development in the long term.

A large unpaid invoice can jeopardise the growth of your business or even lead your company to insolvency. A customer credit check on your existing and potential customer is your first line of defence to ensure they will pay your invoices in due time. How to assess the credit risk of a company? How to run a credit check on a customer? Read our article for guidance on the credit check process.

Bad debts are not good for a business. Sometimes, you may have followed all the steps to prevent cash flow problems and late payment, but you can still be impacted by non-payment. When a customer defaults on its bills or is in danger of doing so, the company extending credit to that customer faces a bad debt expense. The bad debt expense must be charged against your company's accounts receivable and consequently reduces the amount of accounts receivable on your company’s income statement.   Bad debt expense can be detrimental to a business’s long-term success, but fortunately there are ways to manage this expense and mitigate bad debt-related risks. In this article, we share information on bad debt protection cost, bad debt protection insurance, and bad debt protection vs credit insurance. An essential strategy businesses employ is financial risk mitigation. This involves identifying potential threats to a business's financial health and taking proactive steps to minimize those threats. Bad debt protection acts as a cornerstone in this approach, offering companies a buffer against unforeseen financial downturns caused by customer defaults.

Protecting your company from late payments and customer defaults is essential. To do so, you should ensure you have an effective credit management policy in place. But what is credit management and what are its benefits? In this article, we take you through credit management step-by-step, from strategy to execution.

Anticipating the worst scenarios, starting with customer insolvency, is part of good credit risk management. And when risks materialize, the situation can quickly become dangerous without the right credit risk analysis and protection in place. In this article, find out what credit risk is, how to conduct a credit risk assessment and the best credit risk mitigation processes to follow.

Late payment refers to the failure to pay a debt or invoice by the due date agreed upon between the creditor and the debtor. It can refer to both personal and business debts.   Late payments are responsible for a quarter of all business failures. But even one late payment can cramp your cash flow. Legal measures to recoup the funds can create constraints on your time and resources. A late payment letter may not be sufficient. In this article, we discuss how to handle overdue payments and how to avoid them in the future.