Types of risks
The Netherlands has long been known for its spirit of trade. Its domestic market is too small and for centuries the Dutch have been travelling the wider world to trade. The birth of the VOC is a good example of this. But even after the demise of the VOC, the commercial spirit of the Dutch has not disappeared. We do business all over the world.
But the further from our home market we start doing business, the more unfamiliar we are with the market there. The culture and way of doing business differs. And the necessary information about the company with which business is done is often too difficult to obtain, opaque and incomplete. This already makes the debtor himself a financial risk.
On top of that, many exporting countries outside the EU are less politically stable. Even if you do business with financially strong buyers, there may be a foreign exchange shortage, for example. This may result in payments to foreign countries being suspended for an extended period.
World map with risk levels of various countries
Green = low risk, yellow = medium risk, orange = sensitive risk and red = high risk
Credit check
In our immediate neighbourhood, risks are increasing. Think of the UK's departure from the EU (Brexit), Italy's budget deficit and social unrest in France. But also in countries like Argentina, Brazil, several countries in Africa, Russia, Ukraine and China combined with the trade war in the US, we see risks rising sharply.
If you do business with buyers abroad, it is important to cover your risks. It starts with a good creditworthiness check of your buyer. After approval, you can, in principle, do business with this customer with peace of mind. If the buyer is still unwilling or unable to pay, you can always fall back on your insurer, which will then pay the claim. But even if payments cannot be made in the buyer's country for political reasons, the credit insurer will make a payment.
Tailored credit insurance
Xolv works with all leading credit insurers and for each exporter examines the possibilities for optimal credit insurance for its customers. This may depend on the countries being exported to. There are also credit insurers that specialise in insuring buyers in politically sensitive countries.
If you want more information or a tailor-made quote, contact one of our specialists: info@xolv.nl or 073-820 02 95.
