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Credit & Financing

Optimization of balance sheet and liquidity

In times of increasing economic and political uncertainty, good receivables and financial management is becoming increasingly important for securing the company. As an independent insurance broker, we determine your individual receivables default risks and help you select the right insurance instruments. Risks include, for example, bad debt losses due to insolvency of the debtor (protection instrument = credit insurance) and losses due to unauthorized actions of the employee or external third parties (protection instrument = fidelity insurance).

In addition, we draw up concepts for structuring corporate financing and guaranteed credit lines as a supplement or alternative to traditional bank loans.


Merchandise Credit / Export and Avoidance of Transactions in Insolvency Proceedings Insurance

Credit insurance provides insurance cover for revolving receivables from supplied goods and services in the event of insolvency of commercial customers in Germany and abroad. In addition, the insurer - as part of debtor management - also performs credit ratings and routine monitoring of debtors.

The purpose of an external professional credit rating is to prevent or mitigate losses for suppliers and service providers. In addition, the credit insurer assists policyholders in agreeing collateral and shares his expertise in collection services and insolvency proceedings.

 


Bond and Surety Insurance

As an alternative to bank guarantees, the credit/guarantee insurer primarily offers the following types of guarantee types: 

 

  • Maintenance bond 
  • Performance bond 
  • Advance payment bond 

We will of course be happy to advise you on the provision of guarantees, including special guarantees.


Fidelity Insurance

The German economy suffers losses of several billion euros per year as a result of fidelity losses (losses deliberately caused by employees or external third parties that affect the company's assets). Long-standing employees are a particular risk group. If a relationship of trust has developed between employer and employee over many years, appropriate control measures seem unnecessary and fraud by embezzlement is not expected.

 

 

Losses caused by hacker attacks or external service providers can also become a serious threat to a company's liquidity and existence. With a suitable coverage concept and an adequate sum insured, the company is protected even if the party causing the loss cannot be identified.

 


Factoring

Factoring is the sale of short-term revolving monetary receivables from goods supply and services transactions to a factoring institution (factor). The selling company receives up to 90 percent of the purchased receivables immediately after the sale, the remaining amount after payment by the customer or in the event of the customer's insolvency.  

 

Factoring increases the seller's liquidity and the risk of bad debts is transferred to the factor (domestic and abroad). The seller protects his credit lines and expands his possibilities to take advantage of cash discounts. The effect of the balance sheet contraction also improves the seller's equity ratio. Within the scope of flexible sales financing, various factoring options are offered on the market that are tailored to the respective needs of the seller.

 

The following options are available, also in combination:

 

  • Silent Factoring 
  • Open factoring
  • Full service factoring
  • In-house factoring
  • Selective factoring
  • Single-contract models
  • Dual-contract models
  • Reverse or import factoring 

Collection Services

Professionality and speed are the decisive factors for success in debt collection. The product lines of debt collection service providers nowadays begin with invoice printing and invoice dispatch.

 

The providers accompany their customers from court-settled debt collection to debtor monitoring.

In addition to the collection service providers' independent solutions, credit insurers also offer collection services within the scope of trade credit insurance contracts.


Rating and Credit History Information

The need of commercial enterprises for credit information is constantly increasing. Such assessments of the ability of companies to meet economic obligations owed to suppliers and customers are

 

available on the market today with varying information levels, even without taking out credit insurance.

 


Asset-backed Securities

The term asset-backed securities (ABS) refers to off-balance-sheet financing via a sale of receivables to a special-purpose entity domiciled abroad, usually a silent and non-recourse transaction. 

 

Such companies pursue the goal of securitizing and issuing so-called "commercial papers" on the free capital market. Advantage: the inflow of liquidity provides the seller with increased financing flexibility.

Furthermore, the use of ABS has the potential to result in tax benefits and a limitation of credit risk.

 

Our experts have answers and solutions. We will be pleased to advise you.


FAQ

  • How can the default of a receivable be secured?

    Bad debt losses can be covered by traditional credit insurance, excess of loss covers, single-risk and/or political-risk covers or by own insurance solutions such as captives.

  • What types of protection are available to protect against bad debts?

    An insurance policy against bad debts covers losses due to insolvencies for economic or political reasons, non-payment by customers, non-delivery of goods for political or economic reasons or expropriation of investments or assets.

  • What type of alternative finance are available?

    Alternative finance instruments include either special-purpose types of financing such as factoring, forfaiting, leasing, warehouse financing, guarantees, purchase financing such as finetrading and reverse factoring or unrestricted financing such as bonds, private debt financing or private equity.


We will be pleased to advise you

Kontakt aufnehmen

Do you have any questions concerning credit insurances?

Just get in contact with us:

Phone: 02234 9955-0

E-mail: info@isokoeln.de

 

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