Gathering Information about Foreign Credit Applicants

Introduction:  U.S. based credit executives seeking international credit information on credit applicants or active customers often have trouble gathering relevant information.  Some turn to local credit reporting agencies.  However, these reports tend to be shorter than and contain less information about a foreign account than the U.S. based creditor is accustomed to seeing about targets of their credit inquiries.  In some instances, local credit reporting agencies tend to reflect certain aspects of their national culture.  One note of caution:  Irrespective of the source, the accuracy and completeness of foreign credit reports tend to vary widely.

Information about international applicants for open account credit and customers can be difficult to obtain at any price.  Credit professionals quickly learn that it is usually much more difficult to gather the same kind of information - or the same quality of information that is available about a customer or applicant in the United States. Creditors may find that obtaining financial information from foreign customers is even more challenging. One of the best sources of information about doing business internationally is the FCIB.

U.S. credit professionals may be surprised to find that foreign suppliers may be unwilling to share information in response to routine credit inquiries. In some countries, it is not common business practice to request or to respond to reference checks. Another limitation associated with foreign trade references is the fact that the creditor has no way of knowing whether the party giving the trade reference is an impartial third party. For this reason, a creditor should specifically ask the debtor to provide a list of their U.S. trade references.

© 2010 by Michael C. Dennis.  All Rights Reserved.  Mr. Dennis is the author of "1001 Collection Tools and Tips"  and can be reached by email at mcdennis13@yahoo.com