trade credit


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Trade credit

Credit one firm grants to another firm for the purchase of goods or services. That is, when the goods are delivered, the recipient does not have to pay immediately for the goods - a credit is given with terms for payment (say 30 days). This potentially allows the vendor to sell the goods and use the sale proceeds payoff the credit obligation.

Trade Credit

A loan or line of credit that a company extends to another in order for the second company to buy goods and services, especially those necessary to conduct its operations.

trade credit

a deferred-payment arrangement whereby a supplier allows a customer a certain period of time (typically one to two months) after receiving the products in which to pay for them. See CREDITORS, CREDITORS RATIO, WORKING CAPITAL.

trade credit

a deferred payment arrangement whereby a supplier allows a customer a certain period of time (typically two to three months) after receiving the products before paying for them. See also CREDIT, CREDITORS, WORKING CAPITAL.
References in periodicals archive ?
Summary: Karim Nasrallah, GM of the Lebanese Credit Insurer (LCI) and Chairman of the Berne Union Prague Club discusses how trade credit insurance firms are supporting the growth and development of the trade and export industry in Lebanon
In 2014 trade credit premiums of ICISA members increased 2.
Abu Dhabi: Al Hilal Takaful, the insurance subsidiary of Al Hilal Bank, signed a distribution agreement in Abu Dhabi with Euler Hermes, a trade credit insurance company.
Allied World Assurance Company announced that it has brought in an in-house trade credit and political risk insurance platform.
com)-- Summary: Trade Credit Insurance in Russia is a report about the market for trade credit cover in Russia.
An international study supported by ACCA reveals the importance of trade credit and the global differences in accessing it .
Trade credit insurance in the United Arab Emirates is projected to grow by 34 percent to reach USD50m by the end of 2013, according to Massimo Falcioni, the chief executive officer of Euler Hermes GCC.
7bn of trade credit in the past three years, a study has revealed.
The nature of the mechanism is such that the firms are motivated to balance their trade credit inflows with their outflows.
Chaucer, the specialist Lloyd's insurance group, is now offering a new political risk and trade credit coverage in New York.
The world's biggest trade credit insurer, Euler Hermes, has stopped covering exporters shipping to Greece because of the mounting risk of them not getting paid in the event the debt-laden nation is forced out of the euro.
This paper studies the use of supplier's trade credit by firms in financial distress.