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Booming economies like India and Russia may offer great opportunities for UK
firms but they can also cause costly headaches for companies chasing down their
money if customers don’t pay up, says credit insurer Atradius.
According to the company, recovering a debt through the courts in Russia takes
on average 330 days, almost a third longer than in most Western countries.
In India, the legal process is four times as long, taking on average a
staggering 1,420 days to recover a debt.
Simon Groves, Atradius’ Brand Manager for UK & Ireland warned: “Because demand
in these new powerhouse economies is soaring, it is very tempting for UK firms
to trade with foreign customers without the checks and precautions they would
normally have whilst doing business at home.
"But emerging markets are volatile,
so there is a strong possibility that payment could be slow or not forthcoming
at all.
“If a debt goes bad, British firms will be forced to chase their money in a
market where the business culture is unfamiliar, laws are different or
unreformed, and the legal system is slow, inefficient, and in some cases
actively finds in favour of the customer rather than the foreign supplier.
“If you are trying to recover your money in India or Russia, or in fact any
overseas market, it is important to have experts in the country that understand
the payment culture and know how to work the legal system to help you get paid.”
Source:
Credit
Control Journal
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