Aleksandra Lezgovko, Andrej Jakovlev
Abstract. In today’s trade, the vast majority of commercial transactions both domestically and in international trade, are concluded applying trade credit terms.
The aim of this article is to analyse the trade credit insurance and according to the methodology to evaluate it as a credit risk management tool in the context of Lithuanian business market.
The authors have proposed a methodology, which combines theoretical and practical research methods. First of all, with assistance of qualitative analysis the alternative external credit risk management tools were examined. Such analysis allows not only to identify the advantages, disadvantages and benefits of researched risk management tools, but also to assess the efficiency and rationality of trade credit insurance in the context of alternative methods. In order to carry out an assessment in the practical aspect, considering the lack of statistical data, it was decided additionally to perform an expert evaluation.
After performing an assessment of trade credit insurance, it was concluded, that in international trade, with a large buyer portfolio and high sales volume, the trade credit insurance becomes the most effective and rational way to manage credit risk, which eliminates the losses due to the debtor’s insolvency or bankruptcy, manages countries and sector’s risks and helps to discipline the debtor, what determines the decline in overdue accounts frequencies, amounts and volumes.
Plačiau skaityti: čia