Mitigating Techniques for Commercial Risk/Assessment

Assessment
{A common technique to avoid payment risk is to -complete a thorough credit check on new customers. -request bank support for customers. -sell to customers where credit risk insurance is available. +insist that customers wire funds in advance of shipment.
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{The decision as to when to utilize techniques to mitigate payment risk is -determined by the contract signed by the importer. +determined by the exporter’s desire to reduce its risk. -determined by the exporter’s country law. -provided by the sales department who know their customers.
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{A common technique of transference of payment risk is -countertrade. -purchasing credit insurance. +forfaiting the receivable. -requiring a letter of credit.
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{Credit insurance can be purchased from +Ex-Im Bank. -the SBA. -local banks. -the Chamber of Commerce.
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