Credit risk
Commercial (credit) risk refers to a buyer's inability or refusal to pay a guarantor. SERV covers credit risk posed by state-owned importers or private buyers performing public functions. SERV also covers classical private buyer risk, i.e. exports to private purchasers not performing any public function no longer require submission of a guarantee from a bank endorsed by SERV. A decision on whether private buyer risk can be covered depends on the associated credit rating.
Credit risk includes the inability or refusal to pay by:
- Governments, municipalities and other public corporations
- Private enterprises belonging entirely or mainly to public corporations, or fulfilling public functions (public utilities such as power stations, waste incineration plants, etc.)
- Banks endorsed by SERV
- Private buyers
Version: 14.11.2008