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Debt Collections Services in Southern and Eastern Europe on the Rise

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SOURCE Atradius Collections B.V.

AMSTERDAM, June 19, 2014 /PRNewswire/ --

Atradius Collections releases its eighth edition of the Global Collections Review 

Frequently when selling on credit terms - mainly with domestic receivables - European companies experience delays in invoice payments due to liquidity constraints. In order to prevent losses and increase cash flow, companies embrace the use of debt collection agencies.

Despite forecasts of improving economic conditions in many countries, falling demand and cash flow are considered by respondents to be their biggest challenges to profitability this year. Late payment of B2B invoices in Europe is most often due to liquidity constraints of customers. In many cases, the buyer is delaying payment to use their suppliers as a source of interim financing to supplement their working capital. This can lead to payment defaults and cash flow problems for the supplier. The percentage of invoices more than 90 days past due in Europe that are uncollectable is 35% according to the Atradius Payment Practices Barometer.

To handle overdue payments, businesses exporting within or to Europe still use a variety of collection practices according to the Atradius Global Collections Review Europe. In Northern Europe, especially for Dutch (60%), British (49%) and Swedish (45%) companies, it is common practice to collect amicably by partnering with a debt collection agency. In Southern and Eastern Europe approximately 26% of businesses use a collections agency to help collect late payments amicably. While this has increased substantially this year, by 18%, it is still significantly lower than the 40% average for Western and Northern Europe.

Taking legal action to collect debts is typically pursued by half of the businesses surveyed in Southern and Eastern Europe, while only about 30% of the businesses in Western and Northern Europe select this option. Raymond van der Loos, Managing Director Atradius Collections, stated, "The nature of debt collection in many European markets may necessitate taking this route earlier but navigating foreign legal requirements can also prove challenging. The support of an international debt collections agency can in these cases help improve your collections success."

Companies are more inclined to offer credit terms to their domestic customers than to their foreign customers. However, survey results suggest that domestic customers are more likely to delay payment. As a result, businesses are more inclined to use debt collections agencies for domestic than for foreign debts. Only in Southern Europe do you see more than 50% of respondents using collections agencies for foreign debts. Raymond van der Loos explains: "This could suggest that Southern European businesses are less comfortable with collecting overdue foreign debts or that they want to limit language and cultural obstacles to maximize recovery chances."

About the Global Collections Review 

Approximately 3,800 businesses were interviewed across 18 countries in Europe. The Global Collections Review is a recurring research report which has now been published for eight consecutive years, allowing Atradius Collections to analyse trends in collections behaviour by country, across the world. The review is published in three editions: Europe, Asia-Pacific and the Americas and now includes collection practices across specific industries for the various countries. This can help companies create industry focused strategies by country.

The overall report Global Collections Review and the country reports are available at

About Atradius Collections 

Atradius Collections, a business unit of Atradius Group, provides efficient, quick and flexible solutions to recover domestic and international trade debts. With 20 offices and an extensive network of collections specialists and lawyers worldwide, Atradius Collections serves more than 14,500 customers. Over 85 years of global credit management industry experience uniquely positions Atradius Collections as a worldwide leader in business-to-business trade invoice collections services.

Further information:
Iris Graatsma
Telephone: +31-20-553-3139

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