Services

An Accounts Receivable (A/R) PUT is a simple contract where a major bank agrees to buy specified accounts receivables at face value if the obligor files for bankruptcy.

A/R PUTS allow a Vendor to protect specifically against customers’ credit collapse, without affecting ongoing commercial relationships or regular payment processes. A/R PUTS also protect against the credit risk of a specific customer with potential credit or concentration issues, including distressed customers.

The Vendor pays a specified premium for credit protection on a designated amount of that obligor’s receivables during the contract term. A/R PUTS can be coordinated with other forms of receivables management, such as factoring or portfolio-based trade credit insurance. A/R PUT documentation is straightforward, based on standardized credit market terms. Coverage is available for public and liquid private companies.

A/R PUTS provide direct credit protection for underlying Accounts Receivable exposure, allowing the vendor to focus on what it does best - production and sales.

 

Tailored to the Vendor’s needs:

  • Term - protection can be offered for various durations, from 6 – 60 months
  • Size - protection can be offered for a scheduled amount $1 million to $100 million
  • Obligors - protection available for most categories of receivable obligors (name specific)
  • Protection Percentage – 100% of receivables insured
  • Fast Payment – on same day of delivery of protected receivables
  • Strong Counterparty – Major Global Bank

 

Flexible and Cost Efficient:

  • No deductibles
  • No cancellation provisions
  • No limit reductions
  • No need to insure entire Accounts Receivable portfolio
  • No factor controls/intrusive procedures
  • No notice to customer