factris invoice financing factoring

Credit risk

What is credit risk?

Credit risk is the risk a lender faces in lending money to a person or company that may not be able to repay the amount borrowed. It can be influenced by several factors, including the borrower’s financial health and creditworthiness, economic conditions, and the terms of the loan. Credit risk can lead to losses for the lender and can be mitigated by taking measures such as screening borrowers, limiting credit limits, and requiring collateral or guarantees. To avoid risk, credit insurance is an option.

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