Heightened Focus on Receivables Management Having Stabilising Effect on Payment Behaviour During Recession in 2009

AMSTERDAM - The recession has resulted in more companies, worldwide, paying greater attention to their receivables to stabilize their cash flow and balance sheet. The result has been very little deterioration in payment behaviour and in some countries an improvement has been realised.

The “Atradius Payment Practices Barometer”, a twice-yearly assessment of corporate payment behaviour surveyed more than 3,500 firms in Belgium, Denmark, France, Germany, Great Britain, Italy, the Netherlands, Spain, Sweden, Switzerland, Ireland, Austria, Poland, Czech Republic, Canada, United States, Mexico, Australia, Hong Kong and China. The Atradius survey reveals:

- Payment terms in the surveyed countries differ significantly

In the 20 surveyed countries, the average payment term ranged from 22 days in Germany and Poland to 67 days in Italy and Spain. Except for in Italy and Sweden, the payment term in the EU countries, is generally shorter than was reported in the winter 2008/2009 survey.

- Domestic payment behaviour rated highest by US respondents and lowest by Spanish respondents

USA (74% of respondents) and Canada (68%) rate domestic payment behaviour as being “good”, “very good” or “excellent”. Spain (71% of respondents), Italy (67%) and France (66%) rate domestic payment practices as being “poor” or “fair”. In the EU countries surveyed, with the exception of Sweden, perceptions of domestic payment behaviour were consistent with or improved from what was reported in the winter 2008/2009 survey.

- Domestic payment duration is shorter in the EU countries, except for Italy, Sweden and Germany

In the 20 surveyed countries, the average domestic payment duration - the time between the issue of an invoice and its payment - ranged from 28 days in Denmark, Poland and Germany to 78 days in Italy. For EU countries surveyed in winter 2008/2009, this was a decrease of between 2 and 17 days compared to the winter 2008/2009 survey responses for all but Italy, Sweden and Germany which maintained the same payment duration. In France, payment duration improved to 38 days from 55 days in winter 2008/2009.

- Domestic payment delays occur, in general, “rather infrequently”; domestic payment defaults “very infrequently”

Domestic payment delays were said to occur in general “rather infrequently” (most often in the Czech Republic, and least often in Sweden); domestic payment defaults were reported to occur in general “very infrequently” (most often in Hong Kong, and least often in Sweden, China and Mexico).

- Foreign payment behaviour ranked the best by British companies and the worst by Austrians

Foreign payment behaviour was described as “good”, on average, by the companies interviewed in the twenty countries surveyed. In the previously surveyed EU countries, the average perception of respondents in all countries, except Germany, was of an overall improvement in foreign payment behaviour, in comparison to winter 2008/2009 survey responses.

- Foreign payment duration is shorter in the EU countries, except for in Italy and Germany

In the 20 surveyed countries, the average foreign payment duration ranged from 25 days in Poland to 66 days in Italy. In the previously surveyed EU countries, foreign payment duration was generally shorter than in winter 2008/2009, except for in Italy and Germany.

- Foreign payment delays and payment defaults range from “very infrequently” to “rather infrequently”

Payment delays by foreign business partners occur least often in Mexico and most often in Germany; foreign payment defaults occur least often in the Czech Republic and most often in Hong Kong. In the EU countries, foreign payment delays either decreased or remained stable in comparison to winter 2008/2009, except for payments to Germany and France. In Great Britain and Germany, foreign payment default occurred significantly more often than in winter 2008/2009.

- Payment behaviour of foreign customers assessed as “good”

In comparison to the winter 2008/2009 survey responses, customers in the surveyed countries paid their international business partners sooner, except for in the Netherlands and Switzerland. Average payment duration decreased as many as 15 days in Italy to 1 day in Portugal.

Isidoro Unda, CEO of Atradius N.V. commented: “Knowing what to expect from your buyers when it comes to paying for their purchases is essential to effective receivables management. Misjudging when you can expect payments on sales of products and services can seriously impact a company’s cash flow and financial health. Though it is no substitute for detailed information about your specific buyers, the Atradius Payment Practices Barometer can offer a valuable snapshot of trends in payment behaviour that can help suppliers more effectively manage their balance sheets”.

The full “Atradius Payment Practices Barometer” survey, which is designed to track companies’ payment behaviour, can be downloaded from www.atradius.com

About Atradius:

The Atradius Group provides trade credit insurance, surety and collections services worldwide, and has a presence in 42 countries. Its products and services aim to reduce its customers’ exposure to buyers who fail to pay for the products and services they buy. With total revenues of more than EUR 1.8 billion and a 31% share of the global trade credit insurance market, its products help protect companies throughout the world from payment risks associated with selling products and services on credit. With 160 offices, it has access to credit information on 52 million companies worldwide and makes more than 22,000 trade credit limit decisions daily.

www.atradius.com

Source: Atradius N.V.

For further information: Atradius Corporate Communications, Christine Gerryn, Tel.: +31-20-553-2047, E-mail: christine.gerryn at atradius.com