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 Trade
Credit Insurance / Account Receivable Insurance
In an increasingly competitive
environment with shrinking profit,
products and services are not the only deciding
factors. More
and more organizations emphasize on credit terms
which become
an important consideration in any transaction.
.
As credit transactions gradually increase in the
accounts receivables
of an organization, those corporations without adequate
protection
against credit risk will be exposed to severe impact
on cash flow and
even to their viability in the event of any significant
bad debt
provision on their current assets portfolio.
.
Trade credit insurance is a useful tool in transferring
trade credit risk.
It protects businesses from bad debts caused by
their customers arising
from bankruptcy, protracted payments or non-payment
and political risks.
.
In addition to providing protection,
it also offers the following advantages:
1.
Strengthen credit management
....system
of the company.
2. Acquisition of buyer
information to assist
....in
credit management.
3. Reduce appropriate
doubtful debt
....provision
thereby strengthen corporate finance.
4. Serve as security
for A/R financing,
....which
is beneficial to the transaction.
5. Beneficial to the
development of new markets. |
|
.
Overdue
Account Management
What to do with buyer's default?
How to collect overdue account from overseas buyers?
How to precede legal action to protect your interest
in the country of
....buyer's domicile
while lack of knowledge of legal environment there?
How to deal with the situation where many excuses
are given for further
....delay of payment?
Where to locate an experienced lawyer?
Alexander Leed can
help to arrange experienced collection agent
or lawyer to effectively handle the overdue account
collection.
.
Information
Service
From which information agency
to obtain buyer's information?
Many of the information
agencies have their own strength in certain
areas; Alexander Leed would share our experience
and opinion for
your reference.
.
Factoring
One of the risk transfer vehicles
is known as factoring with which debtor's
asset can be sold to a factoring service provider(such
as bank, leasing
company, or other financial institutions) with whom
financing of the relevant
A / R can be arranged simultaneously. It is of a
kind of "without recourse" financing.
.
A
/ R Financing
Taking A/R as the subject
for financing arrangement with banks or financing
institution is of "with recourse" nature
as the risk of the debtor's asset is
retained by the loan taker. However, "without
recourse" financing can be
achieved more economically by assigning the insurance
interest to capital
service providers to leverage for less cost, and
to avail higher country risk
limit for the transaction.
.
Trade
Credit Insurance Market in China
At present, there are only
a few insurers in China could write trade credit
risk.
Alexander Leed has local expertise and is experienced
in providing the service
to clients.
For further information
and / or service requirement, please contact us. |
