Credit & Financial Risks
As a specialist broker, GSA Credit & Financial Risks have access to both local and overseas Insurers allowing us to place your business with confidence.
GSA Credit & Financial Risks prides itself on its innovative, vibrant and energetic team with industry experience spanning more than a combined 25 years. We are confident that after carefully assessing your exposures we can deliver new and innovative solutions and see that you get the best possible outcome.
GSA’s Trade Credit division have expertise across a wide range of financial products including:
- Trade Credit Insurance
Surety and Performance Bonds
If your Company sells goods or provides services on credit terms, Trade Credit insurance should be given consideration.
Businesses, regardless of their size or history, face many financial risks associated with bad debt.
If your company was offered a way of protecting against the unknown, would you still choose to take the risk?
Trade Credit Insurance can provide cover against losses arising from either Protracted Default (non-payment) or Insolvency of one or more of your customers.
All Trade Credit Insurance policies are designed to cater for your business’ specific individual needs, covering either all or a portion of your risk exposures (customers).
Benefits Afforded to Your Business:
Protecting the credit extended to your trade debtors offers security and can provide confidence for increased sales
Liquidity and cash flow is protected
Reduces bad debt reserves and releases capital
Strengthens your borrowing position with financial institutions
Improved budgeting (i.e. a known insurance premium vs. unknown losses)
Enhances Credit Management through credit limit support and information
Commercial Tenant Default InsuranceSurety Bonds
Surety Bonds can provide an attractive alternative to bank guarantees for use by contractors that are required to provide security to the principal, guaranteeing contractual or performance obligations.
Surety Bonds are widely used for contracts within the engineering, building, manufacturing, services and technology sectors.
How can Surety Bonds benefit your business?
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Improves working capital and liquidity
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Generally no requirement for tangible or collateral security
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Establishment of a surety bond facility to facilitate fast and efficient bond issuance
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Confidence to take on new projects
Benefits to Beneficiaries:
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Third party due diligence undertaken on the contractors financial position
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Security in the event of a contractors' default or non-performance under the contract
Types of Surety Bonds available:
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Performance Bonds
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Maintenance Bonds
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Retention Bonds
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Bid / Tender Bonds
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Advanced Payment Bonds
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Offsite Material Bonds
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Lease Bonds
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Settlement Guarantee Bonds
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Workers Compensation Bonds
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Bank-Fronted / Syndicated Bonds
Is your business well established and experienced with the ability and capacity to undertake contracts?
Would you like to know more about how Surety Bonds could potentially improve your ability to secure these contracts?
Contact us to discuss your options
Credit InformationThis product protects commercial and industrial property owners and Fund Managers against the key exposure of tenant insolvency. It contains unique features to the standard product only available to GSA.
Benefits Afforded to Your Business:
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Provides certainty to investors
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Covers up to 12 months loss of rent due to tenant insolvency or default
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Available for single and multi-tenanted assets
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Mitigates impact on investment returns
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Potential to assist in obtaining a lower cost of debt
Collection & Legal ServicesThanks to the partnership established between GSA and illion, we are now able to provide our clients with access to illion databases and reports at a very competitive price.
Who are illion?
illion is the leading independent provider of trusted data and analytics products and services in Australia and New Zealand. Their data registries – which comprise data on over 20 million individuals and over 2.5 million active companies – represent a core element the region’s financial infrastructure. illion’s data assets, combined with their end-to-end product portfolio and proprietary analytics capabilities, enable them to deliver trusted insights to their customers and facilitate confident and accurate decision making.
Why illion?
Bringing trusted data and analytics to life.
illion’s products and services include risk management systems, business information reports, credit ratings, warning and monitoring systems, expert opinions, business guides, and a selection of directories and marketing databases.
Comprehensive data across illion’s commercial and consumer credit bureaus power marketing, ID verification, decisioning, account management, and collections enhancement processes.
Understand your customer
No matter how big or how small your customer, an illion report provides a complete view of their risk profile, giving you the knowledge to make an informed decision about which company you choose to engage.
Find out about:
The company profile of your customer
The Failure Risk Score, which predicts the likelihood that a business will seek legal relief from its creditors, or cease operations leaving unpaid debtsAny adverse information listed on your customer
Any adverse information listed on your customer
Debtor Finance & Trade FinanceThe prompt collection of unpaid invoices is key to be successful in business. GSA have partnered with trusted Collections Agencies that specialise in:
Domestic commercial debt collection
Export commercial debt collection
Consumer debt collection
Credit application and Terms & Conditions wording
Legal Services (pre and post insolvency)
We are happy to discuss your needs and help you find the right partner for your business.
PPSA GuidanceGSA finance can help your business with a wide variety of requirements and products. With access to a large panel of commercial lenders and products we can help source the right product for your business. Whether you are in business and in need of working capital finance, equipment finance, fit-outs, short term loans or in the process of buying a business or paying a business partner out we have solutions for you. Some of the products GSA finance can assist with includes:
Working capital including debtor finance and trade finance
FX requirements
Business overdrafts, line of credits, term loans
Purchasing a business
Commercial transactions
Refinancing or consolidation of existing debt
Trade Credit Calculator
On 30th January 2012 the Personal Properties Securities Act (PPSA) was introduced and it will and has changed the way our clients protect their interests and recover monies under their Retention of Title (ROT).
The Personal Properties Security Register (PPSR) has centralised over 30 existing registers to create a single national register for registration of security interests.
If your security interest in your goods was created before the introduction of the PPSA, it may potentially be deemed as a “transitional agreement” and therefore would be classed as Transitional Security Interests for a period of two years from 30th January 2012 to allow registration. If you do not register your Transitional Security Interests before 30th January 2014, in simple terms, you will lose your security interest and any rights to recover your goods supplied on credit terms.
Important steps to take to secure your businesses on-going security Interests:
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Review, amend & update your Terms and Conditions of sale/trade to incorporate Personal Properties Securities Act Legislation
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Registration of your transitional agreements (existing and entered into prior to 30th January 2012) is strongly recommended
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Registration of all your customers (post 30th January 2012) to protect your rights to recover goods supplied on credit terms
GSA are proud to partner with EDX on all matters related to the Personal Properties Securities Act. EDX are expert consultants in PPSA and offer various options for businesses seeking assistance with their PPS registrations.
Bank Guarantee vs Surety Bond CalculatorCredit Management means growth with a safety net.
More than ever before, having tight Credit Management Procedures has become key to the success of a business.
According to ASIC*, in 2016/17 external administrators lodged 8,425 reports citing the single largest cause of failure as ‘inadequate cash flow or high cash use’ (47% of reports), with the second being ‘poor strategic management of business’ (46%).
Strong Credit Management Procedures are indispensable these days to assess and monitor your clients’ performance and make sure their potential failure doesn’t affect your business.
ASIC also reveals that 97% of companies under external administration in 2016/17 have distributed dividends of less than 11 cents in the dollar to unsecured creditors.
At the end of the day, Credit Management Procedures can mitigate and reduce your loss, but not avoid it. A Trade Credit Policy can be the answer.
Can my business survive if my debtors fail and do not pay? What percentage of unpaid invoices can we sustain?
These are the questions we ask our clients. Based on their answer, we work on a specific solution that might see the implementation of a Trade Credit Policy as the safety net they need to trade safely and focus on growing their business.
Complete our simple online calculator to find out the additional sales required to recoup a bad debt loss.
Everyone is squeezed for cash - Have you considered a Surety Bond?
There is strong demand within the construction industry for Surety Bonds, given that the opportunity to take on multiple large projects has never been greater.
But contractors face significant challenges when attempting to win new projects, with one of the most substantial being cash flow constraints. The principal would normally select a contractor who will be able to fulfil their contractual obligations, whilst also providing 5 – 10% of the contract value in the form of a guarantee or a cash deposit.
According to ASIC*, in 2016/17 external administrators lodged 8,425 reports citing the single largest cause of failure as inadequate cash flow or high cash use (47% of reports), with the second one being poor strategic management of business (46%).
ASIC also reported that in 2016-17 the construction industry had the highest failure rate of any single industry in Australia.
However, the third option available, Surety Bonds, does not tie up company assets.
✘ Bank Guarantee- ASSETS FROZEN
A bank guarantee requires security in the form of cash held on deposit with the bank, or real estate of a certain accepted value to the bank. This freezes up a company’s assets and restricts their ability to take on other jobs simultaneously.
✓ Surety Bonds - ASSETS NOT FROZEN
Surety Bonds are an unconditional guarantee issued by an insurer and are widely accepted by project Principals throughout Australia. As there is generally no requirement for tangible or collateral security, this allows contractors to free up their capital and take on more projects.
Complete our simple online calculator to find out how much your business could save by using Surety Bonds instead of cash deposits or Bank Guarantees
Bank Guarantee VS Surety Bond Calculator
Frendon
Fredon have had a Trade Credit Policy for 30 years and it has now become a major part of our credit management. A proper and diligent credit checks needs to be approved before taking on a new customer; knowing that a customer has good credit allows us to focus our sales efforts on the jobs we want. The policy gives us the peace of mind to know that if a customer goes into administration, not all will be lost; it provides great financial comfort to lenders as they know that the company’s main asset, debtors, are insured.
Piero Bua, CFO
Paykel Media Company
"GSA has been a 10 years + partner of Paykel Media Company and now is one of the Company’s preferred suppliers. At varying times throughout that period, GSA has proven to be a real saviour for our business and a most reliable partner. Credit insurance on turnover is a critical aspect of our business – as well as being a significant cost for us – so it needs to be handled by professionals who know the industry inside out. GSA has the experience, steadiness and professionalism to provide guidance and advice to us at key times. I would highly recommend GSA to any business looking for insurance specialists and suggest they need not look any further than GSA."
Tony Paykel, Managing Director
Capilano Honey
“Capilano Honey appointed GSA in 2009 to look after our Export Trade Credit Insurance. Capilano exports to over 25 countries and GSA have always provided us with excellent service and pertinent advice to meet our insurance requirements during this time. I am always impressed with the attention to detail and quality of service that I receive from the team at GSA and look forward to continuing this relationship in the future.”
Thomas Holliday, Assistant Financial Controller
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