Whole-turnover policies with two major credit insurers cover Rational’s receivables above 10,000 EUR per customer (‘datum line’). Customers regularly showing open items below 2,000 EUR are not insured at all, and accounts between 2,000 and 10,000 EUR are subject to individual decisions with regard to securitization.
For customers that do not qualify for insurance coverage due to bad credit standing or increased country risk, pre-payment or letters of credit are required.
Due to the company’s philosophy to set up sales subsidiaries in all relevant markets, there are sub policies for the 22 sales organisations in countries where legal or tax regulations need to be adhered to or country-specific requirements (e.g. special payments terms or methods) have to be observed.
Business with customers in other markets run through the subsidiary Rational International AG. These direct export sales and the sales of all subsidiaries in Europe, Asia and Latin America are insured with Coface and their local partners, while sales in the fast-growing North American market are covered by Atradius.
As Rational has implemented a so-called process-oriented organisation, the Customer Service department is in charge of the credit limit application process, order and delivery checks as well as the entire dunning process. Therefore, the handling of the credit insurance policies requires a high degree of automation and utmost process reliability. Manual handling was definitely out of the question.