Case Study

Credit Services: A PROACTIVE APPROACH TO CREDIT & DISPUTE MANAGEMENT

Credit Services

Customer valuation: improved processes and reduced risk

Our client is a European based manufacturer with global operations. Due to a lack of centralized control on credit risk and customer disputes within its European operations, our customer was in need of a new solution that would allow for the definition and enforcement of consistent policies for all companies within the region, streamline processes and reduce risk associated to customer credit.

EXECUTIVE SUMMARY

KEY OBJECTIVES

  • Increase control and management of customer credit risk and disputes
  • Increase efficiency in the management of the credit risk for each customer and business line, including: financial indexes, risk rating, credit limit, sales exposure, credit exposure, etc.
  • Deploy a common model to enhance governance for all European affiliates
  • Help determine risk of losses on receivables earlier through customer financial and behavioral data checks
  • Support dispute management case processing across departments, including: Commercial, Financial, and Legal
  • Replace existing system for management of warranties and letters of credit
  • Provide enhanced strategic and operational reporting

RESOLUTION

Techedge completed the switch to the new platform in less than one year, providing our clients Treasury department with a new central and standardized solution for better credit risk management and dispute management.

The solution provided the Company greater insight into their customer’s financial situation, including credit exposure, health of financial statements, guarantees and utilization of letters of credit, its ratings and the solution even captured behavioral data.

In addition, the solution enabled Customer scoring through the implementation of different interfaces to external information providers in conjunction with internal evaluation criteria. This combination of external public data and internal customer records is used to compute and maintain credit parameters for each customer in the system.

Efficiency of the Client’s process was also achieved through optimization of workflow processes and development of standardized reports for all defined user-groups, allowing real-time monitoring of credit risk events.


THE BENEFITS

  • Improved process efficiency and introduction of real-time monitoring of credit-risk events
  • Reduced risk due to more elaborated customer credit-risk data
  • Ability to identify and anticipate high-risk customers in the Sales Order phases for proactive Credit Risk management