Meaning of credit risk, Marketing Research

Assignment Help:

MEANING OF CREDIT RISK : Competition In foreign markets is keener than in the domestic market. Overseas customers are sought after by exporter from many countries. Competition is getting keener still due to an all round effort on the part of all countries to increase their exports. Indian exporters have to compete with exporters from other countries not only in respect of quality, price, delivery schedules, etc., but also in respect of payment terms. Their success would depend upon the ability to offer competitive terms of credit to the foreign buyer's terms of credit on par with those offered by exporters from compacting countries. Risks are inherent all credit transactions but more so, in export transaction. The fact that the buyer may not pay either due to insolvency or for any other- reason exposes the exporter to the credit risks Credit risk may arise even in cases where tile buyer's credit standing that has been thoroughly investigated. Too cautious an attitude in evaluating buyers may result in loss of hand to get business opportunities. Hence, credit risk is unavoidable especially in export business. Credit risk is greater in export transactions because reliable information about foreign buyers is difficult to obtain and hence, it is difficult to evaluate their credit worthiness. Credit risk has assumed large proportions today not only because the volume of export transactions has

Become larger but also because far-reaching political and economic changes that are sweeping the world. An outbreak of war civil war, coup or an insurrection may block or delay the payment for goods exported. Balance of Payment difficulties may lead to transfer delays. And all this is possible even when the buyer is fully in a position to pay. In addition one has to contend with the possibilities of the insolvency or protected default of the buyers. In recent years, there has been significant incense in insolvencies and business failures even in many developed countries. In such a gig risk situation export credit insurance can be of immense help to ( i ) exporters and (ii) the banks who provide finance for the export transaction.

 


Related Discussions:- Meaning of credit risk

Commercial perspective, Commercial Perspective : Trade between two busines...

Commercial Perspective : Trade between two business firms located in different countries begins with the conclusion of an export contract. Under the contract, the duty of the expo

Uses or importance of marketing research to business , Uses or Importance t...

Uses or Importance to Business and Industry: 1 Decision making tool: marketing research is useful for taking marketing management decision. It provides necessary information

Research problem, A research problem in general refer to some difficulty wh...

A research problem in general refer to some difficulty which a researcher experiences in the context of either a theoretical or practical situation and wants to obtain a solution f

Developing the ideas through discussions, Developing the Ideas through Disc...

Developing the Ideas through Discussions: Discussion concerning a problem often produces useful information. Various new ideas can be developed through such as exercise. Hence a re

Marketing.., How is Markov process applied in brand switching

How is Markov process applied in brand switching

Common obstacles in consumer behaviour, Q. Common obstacles in consumer beh...

Q. Common obstacles in consumer behaviour? When first beginning to understand as well as apply Lifestyle and psychographics communicators often run into three impediments. *

Queuing analysis, RatLand is a large family theme park located in central T...

RatLand is a large family theme park located in central Texas.  Over the years a visit to Ratland has been institutionalized as a prime "have to" experience for children growing up

Procedures for furnishing the forms, Procedures for Furnishing the Forms : ...

Procedures for Furnishing the Forms : The declaration form GR (in duplicate) shall be submitted in duplicate to the commissioner of Customs. After duly verifying and authenticatin

Risk reversal, Differentiate yourself with disgracefully bold guarantees th...

Differentiate yourself with disgracefully bold guarantees that you're competition don't have the guts for. Most people are authentically honest, and if your service is what you say

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd