Trade Credit Reinsurance Scheme – Relief for UK Businesses

06/10/2020

|

Charles Draper | The National Law Review

The UK Government have announced the implementation of the Trade Credit Reinsurance Scheme (TCRS), which will provide guarantees of up to £10 billion to Trade Credit Insurers in respect of business-to-business transactions.

Trade Credit Insurance in the UK underwrites an estimated £350 billion of trading for more than 630,000 businesses each year. It insures suppliers against their customers defaulting on payment, ensuring businesses have confidence to trade without fear of lost income and wasted cost.

The effect of COVID-19, and the Government’s response to COVID-19, has led to market concerns that trade counterparties may struggle to satisfy outstanding trade debts and/or default on future trade debts. This has caused a real risk to UK businesses that insurers may withdraw trade credit insurance or increase insurance premiums to unaffordable levels.

To view the original article, click here.