Presentation on theme: "Assessing and minimising the credit risk. Współpraca z Dun & Bradstreet2 The Plan The most common mistakes done by companies admitting the credit limits."— Presentation transcript:
Assessing and minimising the credit risk
Współpraca z Dun & Bradstreet2 The Plan The most common mistakes done by companies admitting the credit limits and ways to avoid this. How to evaluate the risk of your client’s portfolio? Costs and benefits.
Współpraca z Dun & Bradstreet3 The most common mistakes and solutions Mistakes Casual setting of credit limits. No updates of the knowledge about clients The lack of clear lines of authority between sales and financial department Over reliance on collateral Solutions No credit limits in the absence of sufficient data Regular (annual) status check All credit limits decisions should be centralised within finance function, but collaborating with sales The information is the foundation to trade and risk limiting.
Współpraca z Dun & Bradstreet4 Categorisation - what to do next High risk companiesLow Risk companies What we do next ? Check in 6 months Conservative credit limit Credit Limit based on collateral What we do next? Set the credit limit Non - standard solutions in „hard”casesCheck once in year