A survey by one of the world's biggest credit insurers has reported a significant increase in the take up of credit insurance, but according to the survey by Atradius, letters of credit (L/Cs) remain a popular tool for ensuring payment.

The survey canvassed more than 2,500 business executives in 14 countries to seek their views on risk management tools in international trade and sought their perspectives on the global credit crisis.

US focus

The survey focused on the mounting challenges facing businesses in the US, where insolvencies are up 44 per cent according to the survey.

"We have seen a significant increase in credit insurance applications over the past three quarters," says Atradius' CEO, Brett Halsey. He says "protecting receivables and turning them into working capital is an essential responsibility of today's executive and this survey shows that, now more than ever, US companies are using a variety of tools to stay competitive."

Risk management tools

The survey details a wide range of risk management tools currently in use around the globe.

In the US, companies rely most heavily on cash (in advance or upon delivery), while credit management and reminders, L/Cs and guarantees and use of collections agencies are other popular methods of ensuring receivables, according to the survey.

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