There are many reasons which could cause your customers to fail to pay debts especially in an economy that is facing challenges like ours. Your most trusted customers whom you have dealt with for a long time can still default on the payments due to you. Trade Credit Insurance however will give you the comfort of knowing that in the event that a default happens, someone else bears the consequences.
The good thing is Domestic Trade Credit Insurance is now available in Zimbabwe through the reputable Zimnat Lion Insurance Company, and here are some of the benefits of getting it,
1. Better Cash-flow Management
Cash inflow is the lifeblood of any organisation. It is always pleasurable for businesses to receive payments from customers within the stipulated time frame. When your business has failed to collect payments your cash flow will be strained. Trade Credit Insurance comes in to replace that cash should a default occur allowing you to grow your business and make new investments.
2. Sales Expansion
It is easier to sell more when you have your receivables protected. Expanding sales on your existing customers and also selling to other customers who are deemed risky can be made easier. You can give customers a more liberal time frame to make payments whilst being assured of receiving the payments in the future.
3. Better Financing
Cost of getting funding from different lending institutions is typically reduced when your receivables are protected by Trade Credit Insurance insurance. In some cases Banks actually require you to have Trade Credit Insurance to approve your loan.
4. Reduction of Bad-Debt Reserves
Trade Credit Insurance reduces bad debt reserving by up to 90%. Reducing your bad debt provisioning will free up capital for your company which can be used for growth of your company.
5. Free information and economic knowledge
Trade Credit Insurers have large databases on different customers which can be used to reduce your operational and information costs. They assist you in knowing who to sell to on credit and on a cash basis.
Take advantage of Domestic Trade Credit Insurance and grow your business. Contact specialist Trade Credit Insurers Zimnat Lion Insurance today.