Bad Debt Protection
Bad debts are bad for business and can adversely affect your profits, cash flow and balance sheet. In some cases, the impact of a bad debt can put your entire business at risk.
If you are trading on credit terms, there is always the risk of bad debts. This can be due to customer insolvency or protracted default, where a debt remains unpaid after an extended timeframe. Bad Debt Protection is an ideal way to safeguard your business against non-payment of trade debts. It can be provided as a standalone product from Credit Insurance companies. Some Invoice Finance providers offer Bad Debt Protection as an optional extra. This is known as non-recourse funding.
What are the benefits of Bad Debt Protection?
- Protect your cashflow. You mitigate the risk associated with offering credit to trade customers.
- Peace of mind. You can rest assured your business is protected against the risk of bad debts.
- Access to finance. Invoice Financiers may provide more finance if Bad Debt Protection is in place.
- Vital credit information. You get information on customers alerting you to potential problems.
- Competitive Advantage. You may be able to offer better credit terms to your debtors.
How much does Bad Debt Protection cost?
The cost varies depending on what product you choose, your turnover and track record. When you call us, we can explain all the various options to you, outlining all the costs involved.
What’s the next step?
If you are considering Bad Debt Protection, either as a standalone product, or as part of a funding package, you’ll have to make sure you choose the right product. Speak to our Experts to find out how which option best suits your business to safeguard against the risk of bad debt.