Trade credit insurance remains a significant problem despite the supply of credit and bank loans improving, the latest Confederation of British Industry, Access to Finance Survey reports.
This has been having a knock on effect to credit limits offered to Companies using Invoice Factoring, which is in turn slowing down the economy. The way in which credit and insurance and factoring are linked should not be understated.
A balance of 54% of firms reported its availability had worsened in the three months to May. This was not as severe as in the March survey (72%).
Ian McCafferty, CBI chief economic adviser, said: “"While the government has made some welcome moves to improve the availability of trade credit insurance, it remains a very live issue for many businesses, and more could be done to ease the pain.
It is suggested that if our economy is going to lift itself out of recession the issue of credit insurance should be addressed.