How to improve the management of your company’s credit area

During the past few years, we have been experiencing a period of financial turmoil in our country. Therefore, it is of the utmost importance that businessmen not only take certain precautions, but also acquire greater in-depth knowledge of their clients, and find the best options for certain investments.

Brazil has weathered several crises, and due to a lack of availability of tools to mitigate credit risks, companies – especially the larger corporations – have created big credit areas, employing dozens of employees solely dedicated to the analysis of credit limits and to attempting to mitigate fraud risks.

On the other hand, small and medium companies, with only one or two individuals in their credit areas, did not have the capacity to carry out in-depth risk assessments, and opted for mere restricted assessments.

What we observed during recent years were huge losses from unpaid sales, which resulted in the bankruptcy of innumerable companies.

With the passage of time and after considerable losses, companies started to automate their analysis system, and implemented credit policies. However, to face the process, it was necessary to be able to count on a certain number of qualified employees, and that resulted in a rather high cost for the companies.

We have clearly witnessed the considerable concern shown by company managers about conducting sales safely. Considering the current lean margins, an unpaid sales transaction can result in the need to sell much more.

Credit Insurance is among the tools that managers have since implemented. In the event they do not get paid for their sales, this insurance will guarantee the payment of an indemnity for the loss, and moreover will increase the reliability of the company’s cash flow.

As it can be perceived, with the implementation of Credit Insurance, companies are able to count on dozens of insurance company analysts, who will analyze the risks, monitor the portfolios, and arrange indemnification in the case of non-receipt of payment.

Therefore, credit area managers, of big and small companies alike, can count on Credit Insurance as an excellent tool to protect their cash and help the company grow safely.

Do you still have any doubts about this subject? Download for free our Definitive Guide on Credit insurance, and see what this service can do for your company: