- While useful, traditional methods of managing credit risk data have their limitations and lack real-time insights.
- The latest innovations provide a more diverse analysis, for a faster decision-making process.
- Allianz Trade offers customers access to the reliable data it uses to make credit decisions. It’s data we trust, and you can too!
Summary
Key Takeaways
Our Senior Credit Analyst, Nicole White, recently sat down with Mike Lawrence, Head of Sales at Xenia to discuss the power of data. They discussed the importance of data to make informed business decisions, the potential pitfalls of historic credit agency data, and the support provided by Allianz Trade in the UK and Ireland.
You can watch the full video below as we take a look at this topic in more detail.
Managing credit risk: How was this done traditionally?
Traditionally, credit risk analysis was completed using historical data – most likely held by organisations like Companies House.
While this was a useful way of understanding a business’ previous trading history, it doesn’t always give an accurate view of its current trading status. For example, a once profitable company could now be making a loss.
It was a rule-based system which meant those without a perfect track record were seen as risky and were less likely to secure credit.
How are insights improving credit risk management?
Credit risk data allows companies to make more informed decisions to do better business. It helps you to secure your supply chain, track your clients’ financial health, and optimise your prospect targeting.
Data offers businesses:
A diverse analysis
With services like Grade Check , a contemporary credit risk dataset will pull on various sources of information to present a comprehensive view of creditworthiness summarised into an easy-to-grasp score on a scale of 1 to 10.
Not only will the data that informs this score reveal previous filing information but also wider insights such as payment patterns and transaction histories for a holistic view of the credit risk. This can help build trust with your suppliers and customers as there will be no financial secrets or nasty surprises.
A current view
In an ever-changing economy and political climate, a mix of traditional and more modern methods of data collection allows a reactive approach to credit risk management.
By pooling data from numerous sources, and with ongoing monitoring, services like ours can provide up-to-date information that reflects a business’ current situation, providing customers with the latest insights so they can trade with confidence.
For example, Grade Check provides credit grading via the Allianz Trade Online portal, or it can be plugged directly into your ERP system using our API. This means you’ve data available to you 24/7 and you can get alerts when a partner’s rating changes. It’s a great early warning system of potential default, giving you a heads up before Companies House. So, you can trade with confidence, even if you’re dealing with businesses on the other side of the world.
A faster decision-making process
With automated data collection, ongoing monitoring, analysis and online reporting, assessing credit risk becomes a more streamlined process. This leads to real-time responses to risk in the form of a grade and, in many cases, predictive models that use advanced analytics can help anticipate risk before it occurs.
Reduced business interruption
With data, you can minimise supply chain disruption and the domino effects this can have. Whether caused by an insolvency, political event, or a cyber hack, you’ll know quickly and can take action to manage this situation with a tailored solution to ensure business continuity.
In the latest Allianz Risk Barometer, business interruption ranked as the second-biggest concern for UK firms. This was particularly pertinent to smaller firms with less adaptive ability, therefore showing the importance of data and protection.
“Building and investing in resilience is becoming critical for every company around the globe” says Michael Bruch, Global Head of Risk Advisory Services at Allianz Commercial.
A scalable solution
With increasing data access, you can quickly and easily check on your most valuable customers and suppliers, as well as prospects. However, at Allianz Trade, some of our largest customers use our data services to grade and monitor as many as 33,000 commercial partners using either Allianz Trade Online or API. You’re in control of how many, or how few, businesses you manage.
Data our business counts on, and yours can too
We’ve more than 62,000 clients worldwide and monitor 83 million businesses in 160 countries to provide our customers with the latest, most accurate credit risk data possible.
Whether you’re interested in trade credit insurance or our insights service Grade Check, we can help protect your business by building a base of trusted, creditworthy customers and suppliers, using highly accurate and up-to-date information.
For a free consultation or to learn more get in touch.
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Our expertise and commitment
Allianz Trade is the global leader in trade credit insurance and credit management, offering tailored solutions to mitigate the risks associated with bad debt, thereby ensuring the financial stability of businesses. Our products and services help companies with risk management, cash flow management, accounts receivables protection, Surety bonds, Business Fraud Insurance, debt collection processes and e-commerce credit insurance ensuring the financial resilience for our client’s businesses. Our expertise in risk mitigation and finance positions us as trusted advisors, enabling businesses aspiring for global success to expand into international markets with confidence.
Our business is built on supporting relationships between people and organisations, relationships that extend across frontiers of all kinds - geographical, financial, industrial, and more. We’re constantly aware that our work has an impact on the communities we serve and that we have a duty to help and support others. At Allianz Trade, we’re strongly committed to fairness for all without discrimination, among our own people and in our many relationships with those outside our business.