Credit Management magazine June 2020

The CICM magazine for consumer and commercial credit professionals

The CICM magazine for consumer and commercial credit professionals

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CM<br />

JUNE <strong>2020</strong> £12.50<br />



All washed up<br />

Has the Pre Pack Pool<br />

run aground?<br />

A credit squeeze is<br />

coming but how long<br />

will it last? Page 18<br />

Sean Feast talks<br />

to Richard Webster<br />

of AIG. Page 24

JUNE <strong>2020</strong><br />

www.cicm.com<br />

13<br />


Sue Chapple FCICM<br />

20<br />


Paula Swain<br />


View our digital version online at www.cicm.com. Log on to the Members’<br />

area, and click on the tab labelled ‘<strong>Credit</strong> <strong>Management</strong> <strong>magazine</strong>’<br />

<strong>Credit</strong> <strong>Management</strong> is distributed to the entire UK and international CICM<br />

membership, as well as additional subscribers<br />

Reproduction in whole or part is forbidden without specific permission. Opinions expressed in this <strong>magazine</strong> do<br />

not, unless stated, reflect those of the Chartered Institute of <strong>Credit</strong> <strong>Management</strong>. The Editor reserves the right to<br />

abbreviate letters if necessary. The Institute is registered as a charity. The mark ‘<strong>Credit</strong> <strong>Management</strong>’ is a registered<br />

trade mark of the Chartered Institute of <strong>Credit</strong> <strong>Management</strong>.<br />

Any articles published relating to English law will differ from laws in Scotland and Wales.<br />

32<br />


Marco Forgione<br />

President Stephen Baister FCICM / Interim Chief Executive Sue Chapple FCICM<br />

Executive Board Pete Whitmore FCICM – Chair / Debbie Nolan FCICM(Grad) – Vice Chair Glen Bullivant FCICM<br />

Treasurer / Larry Coltman FCICM, Victoria Herd FCICM(Grad), Bryony Pettifor FCICM(Grad)<br />

41<br />


Gareth Edwards<br />

10<br />


Sean Feast FCICM<br />

Advisory Council Sarah Aldridge FCICM(Grad) / Laurie Beagle FCICM / Glen Bullivant FCICM / Lauren Carter FCICM /<br />

Larry Coltman FCICM / Victoria Herd FCICM(Grad) / Philip Holbrough MCICM / Laural Jefferies FCICM Diana Keeling FCICM /<br />

Martin Kirby FCICM / Christelle Milojkovic FCICM / Julie-Anne Moody-Webster FCICM(Grad) / Debbie Nolan FCICM(Grad) /<br />

Ute Ogholoh MCICM / Bryony Pettifor FCICM(Grad) / Allan Poole MCICM / Phil Rice FCICM / Chris Sanders FCICM /<br />

Paul Taylor MCICM / Pete Whitmore FCICM.<br />


10 – Nose dive<br />

What happens if the government<br />

decides not to make Pre Pack referrals<br />

compulsory?<br />

13 – Recovery Room<br />

Managing credit through the recovery.<br />

14 – Breaking Bad<br />

The pandemic is having an impact at<br />

every level, including divorce.<br />

18 – International Rescue<br />

Special feature – COVID 19 and the<br />

impact on future credit.<br />

20 – Swain’s World<br />

Out and about with Paula Swain of<br />

Shoosmiths.<br />

22 – Testing Times<br />

Coronavirus is impacting payments<br />

across all industries and sectors.<br />

24 –Driving Force<br />

Richard Webster of AIG says<br />

many seectors were under pressure<br />

pre-COVID 19.<br />

32 – The Oyster Catcher<br />

Marco Forgione believes the world is our<br />

oyster.<br />

34 – Changing Gear<br />

The UK’s Automotive Industry faces a<br />

difficult future.<br />

39 – Remote Possibilities<br />

New rules are required for remote hiring.<br />

41 – Fatal Attraction<br />

Clarity is everything when drafting<br />

restrictive covenants.<br />

46 – Sustainable Development<br />

How a sustainability strategy is more<br />

than just about saving the planet.<br />

Publisher<br />

Chartered Institute of <strong>Credit</strong> <strong>Management</strong><br />

The Water Mill, Station Road, South Luffenham<br />

OAKHAM, LE15 8NB<br />

Telephone: 01780 722900<br />

Email: editorial@cicm.com<br />

Website: www.cicm.com<br />

CMM: www.creditmanagement.org.uk<br />

Managing Editor<br />

Sean Feast FCICM<br />

Deputy Editor<br />

Iona Yadallee<br />

Art Editor<br />

Andrew Morris<br />

Telephone: 01780 722910<br />

Email: andrew.morris@cicm.com<br />

Editorial Team<br />

Rob Howard and Imogen Hart<br />

Advertising<br />

Grace Ghattas<br />

Telephone: 020 3603 7946<br />

Email: grace@cabbell.co.uk<br />

Printers<br />

Stephens & George Print Group<br />

<strong>2020</strong> subscriptions<br />

UK: £112 per annum<br />

International: £145 per annum<br />

Single copies: £12.50<br />

ISSN 0265-2099<br />

Advancing the credit profession / www.cicm.com / <strong>June</strong> <strong>2020</strong> / PAGE 3


Crisis? What Crisis!<br />

Sean Feast FCICM<br />

Managing Editor<br />

‘It is always wise to look ahead,<br />

but difficult to look further than<br />

you can see.’<br />

NO superlatives or hyperbole are enough<br />

to describe the extraordinary times we<br />

find ourselves in. The much-anticipated<br />

announcement from the Prime Minister<br />

that many of us hoped would hint at a plan<br />

by which we could return to normality –<br />

whatever that looks like – didn’t deliver anything other<br />

than disappointment. Aside from now being able to<br />

swing a club or a tennis racket with a nominated friend<br />

or family member, not much has changed. (That said, for<br />

those golfers or tennis pros amongst us, that was probably<br />

enough!)<br />

But while the government, ministers and politicians<br />

of every hue still come across as alarmingly ill-prepared<br />

for what lies ahead, the same cannot be said for the credit<br />

community. Reporting on a forum last month of senior<br />

industry professionals (see our special news feature on<br />

page 10) I was reassured to hear that most within our<br />

industry not only had a plan for dealing with the current<br />

crisis but were, to paraphrase General MacArthur,<br />

executing those plans violently.<br />

Well documented and thought-through Disaster<br />

Recovery (DR) and crisis plans had been rehearsed and<br />

were now being implemented. Tough times undoubtedly<br />

lay ahead, but I didn’t sense a single headless chicken. Far<br />

from it. ‘Wise old birds’ was more the phrase that sprang to<br />

mind. (With apologies to Phil.)<br />

Our leader picks up on this theme in her column.<br />

Crucially, she says, what we’ve been going through over<br />

the last eight weeks or so was not necessarily the tough<br />

bit (though that’s a difficult message to hear for those<br />

millions furloughed or with their wages cut). The really<br />

hard work, Sue says, starts now as we manage our way<br />

through the recovery. If past crises are anything to go by,<br />

she’s probably right. What she’s also right about is that<br />

knowing your customer is now more important than ever<br />

as credit managers collect the cash from those who can<br />

pay and work closely with those who cannot to find a new<br />

way forward.<br />

Winston Churchill, in one of his lesser known<br />

quotations, said: ‘It is always wise to look ahead, but<br />

difficult to look further than you can see.’ There’s plenty<br />

of sense in that. Do what you can. Act on what you know.<br />

Be decisive. But be understanding too. Tomorrow has a<br />

strange knack of working itself out.<br />

Advancing the credit profession / www.cicm.com / <strong>June</strong> <strong>2020</strong> / PAGE 4



This year we have partnered with Croner<br />

Reward, the experts in Pay &Benefits<br />

benchmarking, to bring you our annual Salary<br />

Survey. Our <strong>2020</strong> report isthe definitive guide<br />

on the market, solely focused on credit sector<br />

salaries, interim pay rates combined with<br />

further information on employee benefits,<br />

recruitment trends and our own unique<br />

market insight.<br />

In your copy you will find salaries and<br />

benefits for <strong>Credit</strong> professionals that we<br />

recruit for around the UK. The roles include:<br />

<strong>Credit</strong> Administrator<br />

<strong>Credit</strong> Controller<br />

<strong>Credit</strong> Supervisor<br />

Sales Ledger Clerk<br />

Accounts Receivable<br />

Team Leader<br />

<strong>Credit</strong> Risk Manager<br />

Head of <strong>Credit</strong><br />


www.portfoliocreditcontrol.com/salary-survey<br />


LONDON | 0207 650 3199<br />

MANCHESTER | 0161 836 9949<br />

www.portfoliocreditcontrol.com<br />

recruitment@portfoliocreditcontrol.com<br />

Advancing the credit profession / www.cicm.com / <strong>June</strong> <strong>2020</strong> / PAGE 5

CMNEWS<br />

A round-up of news stories from the<br />

world of consumer and commercial credit.<br />

Written by – Sean Feast FCICM<br />

<strong>Credit</strong> insurers avoid meltdown<br />

in wake of record claims<br />

A<br />

temporary reinsurance<br />

scheme introduced by the UK<br />

Government may have saved the<br />

credit insurance industry from<br />

meltdown.<br />

The announcement came after the<br />

CICM Think Tank heard estimates that<br />

insurers could be staring at claims in<br />

excess of £1.5 billion over the next 12<br />

months – a figure that could lead to them<br />

taking ‘radical action’, according to one<br />

Think Tank member.<br />

“Without government support, the<br />

magnitude of the losses could be off the<br />

scale,” the Think Tank member claimed,<br />

potentially leading insurers to a repeat<br />

of the 2008/9 fiasco that saw all of the<br />

major insurers – Euler Hermes, Atradius<br />

and Coface – pulling cover with little or<br />

no notice and leaving many businesses<br />

uninsured and uninsurable.<br />

Now this meltdown looks to have<br />

been averted with news of a deal struck<br />

between the Government, the Treasury,<br />

and the insurance industry that will<br />

temporarily guarantee business-tobusiness<br />

transactions currently<br />

supported by trade credit insurance,<br />

ensuring the majority of insurance<br />

coverage will be maintained across the<br />

market.<br />

Insurers, however, were still unlikely to<br />

be writing any new business soon: “Most<br />

have been pushing back on new business<br />

requests and unless the Government<br />

steps in, I can’t see the appetite for<br />

writing new business improving,” the<br />

member added.<br />

In discussing life after lockdown, Think<br />

Tank members considered the impact<br />

of COVID-19 on consumer collections,<br />

and were perhaps surprised by the<br />

experiences of their peers. Two industry<br />

CEOs confirmed similar experiences in<br />

that continued payment authorisation<br />

(CPA) and direct debt (DD) payments were<br />

holding up:<br />

“Some clients did not allow us to make<br />

outbound calls initially, but when that<br />

changed and we were able to speak to<br />

customers, they tended to be hugely<br />

appreciative because they were keen to<br />

keep their payments up-to-date and/or to<br />

discuss what help was available to them,”<br />

one of them said. “We are used to dealing<br />

with vulnerable customers anyway.”<br />

Interestingly, one CEO quoted a figure<br />

of 40 percent for the volume of calls in<br />

which a customer cited problems over<br />

COVID-19, and said that the agencies that<br />

faced the biggest challenge were those on<br />

the panel for collecting Government debt<br />

which had been all but put on hold: “They<br />

have simply not been able to collect,” the<br />

CEO said.<br />

In terms of business to business (i.e<br />

commercial) collections, the challenge<br />

of the virus had not yet fully manifested<br />

itself into a payment hiatus, but most<br />

of the Think Tank members agreed that<br />

collections would be getting harder: “The<br />

number of payments are dropping but the<br />

values are still holding up,” one reported.<br />

“Some clients are still ‘business as usual’<br />

whereas others have put a halt on our<br />

activities.” What happens next in terms<br />

of Government support was crucial. If<br />

payment holidays, mortgage holidays,<br />

and all other forbearance measures are<br />

suddenly taken away, it could seriously<br />

impact the health of the economy as the<br />

country emerges out of lockdown. It could<br />

also impact the size and scale of any<br />

potential recession, and the number of<br />

businesses that fail.<br />

One industry-leading IP said that<br />

insolvency practitioners were currently<br />

in something of a ‘Phoney War’ but that<br />

a ‘Blitz’ was shortly to come: “IPs will be<br />

busy later this year and into 2021,” she<br />

concluded.<br />

The CICM Think Tank is a group of<br />

senior leaders from all aspects of the<br />

commercial and consumer credit world<br />

that meets quarterly to hear, learn,<br />

discuss and share best practice.<br />

Advancing the credit profession / www.cicm.com / <strong>June</strong> <strong>2020</strong> / PAGE 6


> IN BRIEF<br />

UK economy ‘tanks’ as risk of<br />

non-payment increases<br />

THE UK economy is ‘tanking’, and it will<br />

become increasingly difficult to collect<br />

debts. This was the key message to<br />

come from a Think Tank presentation<br />

by Markus Kuger, Chief Economist<br />

of Dun & Bradstreet, that painted a<br />

gloomy picture of the national and<br />

global economy as it emerges from the<br />

COVID-19 crisis. Eurozone real GDP is<br />

expected to have fallen by 3.9 percent<br />

(year-on-year) in the first quarter of <strong>2020</strong><br />

which Markus described as ‘historic’. In<br />

the US, for the same period, real GDP is<br />

expected to contract by 4.8 percent.<br />

Worst hit within the eurozone (<strong>2020</strong><br />

forecast) will be Italy which is likely to<br />

experience negative growth of 10.5% -<br />

almost double that of the UK (negative<br />

5.5 percent). But Markus warns that<br />

it could be worse: “Italy is the one to<br />

watch,” he told the Think Tank, “and its<br />

performance assumes there will not be<br />

another spike in the Coronavirus. This<br />

is a severe contraction in GDP at a time<br />

when GDP growth had been slowing<br />

down anyway.”<br />

Although Markus expects the<br />

recovery to be, perhaps, surprisingly<br />

fast, he did warn credit managers that<br />

currently the pandemic is impacting on<br />

all aspects of economic life and weighs<br />

on both supply and demand: “Central<br />

banks are providing more monetary<br />

stimulus than ever, and governments<br />

are increasing deficits to levels never<br />

seen before,” he explained.<br />

“Regardless of the stimulus, the world<br />

economy will see the biggest peacetime<br />

contraction in almost a century, and<br />

the risk of late and non-payment will<br />

increase substantially over the next six<br />

months.”<br />

BIPA agrees policy<br />

on Government loans<br />

CREDIT Reference Agencies have<br />

agreed to work together to minimise<br />

the impact on the CRA assessment<br />

of any application by a business for<br />

a government scheme designed to<br />

support business survival through the<br />

COVID-19 crisis.<br />

Representatives of BIPA – the<br />

Business Information Providers<br />

Association – told the CICM Think<br />

Tank last month that its members have<br />

agreed a guiding principle, striking<br />

a balance between ‘minimising the<br />

impact on businesses for taking<br />

advantage of schemes that might<br />

ordinarily be interpreted as a sign<br />

of business weakness together with<br />

reporting on the live data that finance<br />

lenders and grantors of trade credit<br />

use as part of their decision-making<br />

process.’ BIPA was keen to point out,<br />

however, that while accounts may be<br />

frozen, credit scores were not: ‘<strong>Credit</strong><br />

scores may continue to fluctuate due to<br />

other factors and these scores are not<br />

the sole source of information used by<br />

lenders to make lending decisions,’ it<br />

states.The Association promised to<br />

keep its approach under review and<br />

continue to liaise with other industry<br />

and public bodies as the government<br />

updates any such policies to ensure<br />

best practice in supporting businesses,<br />

finance lenders, trade creditors and the<br />

economy.<br />

BIPA membership comprises the<br />

seven principal CRAs who between<br />

them make more that 224 million<br />

decisions across 7.65 million businesses<br />

to support 316,000 users.<br />

Social climbing<br />

A new report from the Centre for Social<br />

Justice is said to make a ‘powerful<br />

case’ for the need for a Government<br />

Debt <strong>Management</strong> Bill, according to<br />

the Money Advice Trust. The CSJ’s<br />

newly-published report, ‘Collecting<br />

dust: A path forward for government<br />

debt collection’ outlines how central<br />

and local government lag behind the<br />

private sector in their approach to debt<br />

collection. It calls on the government to<br />

take action to improve debt collection<br />

practice at both a central and local<br />

government level – something that<br />

will be even more pressing given the<br />

financial impact of the Coronavirus<br />

outbreak on households across the UK.<br />

www.centreforsocialjustice.org.uk<br />

Haig Convention<br />

COLIN Haig, Restructuring Partner at<br />

BDO, has been appointed President of<br />

R3, the insolvency and restructuring<br />

trade body. Colin takes over from<br />

Duncan Swift, Corporate Advisory<br />

Services Partner at Moore UK, who<br />

has just completed his year-long term<br />

as R3’s President. Colin, who has over<br />

40 years’ experience as an insolvency<br />

practitioner, will work with R3’s<br />

senior staff to guide the trade body, its<br />

members, and policy makers through<br />

the challenges presented by COVID-19.<br />

Simply perfect<br />

SIMPLY, the SME lender, has helped<br />

Swanage Taxis, operating as Linkrider<br />

Coaches, to restructure its finance<br />

agreements to ensure that it can<br />

weather the current COVID-19 storm and<br />

continue trading. Linkrider Coaches is<br />

a family-run firm that provides student<br />

and private coach hire services to the<br />

whole of Dorset and the south coast.<br />

Because the bulk of its work is focussed<br />

on the transport of students to and from<br />

their places of study, there has been no<br />

business for the firm since educational<br />

establishments closed before Easter.<br />

Simply created a bespoke payment<br />

profile that mirrored the seasonal nature<br />

of the business, giving the company as<br />

much flexibility as possible.<br />

CSA calls for joint action during and after lockdown<br />

THE <strong>Credit</strong> Services Association (CSA)<br />

has received a positive response to its<br />

call for closer collaboration with trade<br />

bodies representing the wider business<br />

community in planning for a phased<br />

relaxation of current lockdown rules.<br />

It also says that fellow trade<br />

associations have welcomed its drive<br />

to prevent the actions of a minority of<br />

‘extreme outliers’ to distract from the<br />

excellent work already being done by<br />

industry to support those in debt.<br />

In a letter sent to his opposite<br />

numbers at trade bodies representing<br />

many of the clients of CSA members,<br />

including banks and credit card<br />

companies, as well as those representing<br />

utility and telecoms providers, Peter<br />

Wallwork, the CSA CEO, cited concerns<br />

where firms owed money may not be<br />

acting appropriately:<br />

“In a very few isolated cases, some<br />

of our members’ clients are seeking to<br />

require an approach that is ‘inconsistent’<br />

with the enhanced forbearance our<br />

members subscribe to, putting them in<br />

potential conflict,” he says.<br />

“While I stress such cases are<br />

categorically not indicative of a<br />

widespread problem, we must ensure<br />

that, whatever the financial pressures<br />

creditors are under, they work with<br />

our members to the same standards of<br />

understanding and forbearance towards<br />

customers that the CSA is committed<br />

to promoting. Coming out of lockdown<br />

may be even more complex than going<br />

in, and we need the landscape and the<br />

challenges to be fully understood by all.”<br />

Peter says its members had already<br />

adjusted their practices to enhance<br />

forbearance.<br />

Advancing the credit profession / www.cicm.com / <strong>June</strong> <strong>2020</strong> / PAGE 7


Professionally speaking<br />

A forum of senior credit professionals discussed<br />

managing credit through the recovery.<br />

Written by – Sean Feast FCICM<br />

THE COVID-19 crisis has changed,<br />

and will continue to change, the<br />

way we currently work, and has<br />

elevated credit management<br />

to ‘the top table’ in businesses who at<br />

last recognise the value of working<br />

with professional credit managers.<br />

Maintaining this status, however, and<br />

ensuring that the importance of credit<br />

management is embedded in future<br />

thinking is going to be a challenge,<br />

especially as the memory of the crisis<br />

fades with the resumption of ‘business<br />

as usual’.<br />

These were among the key insights<br />

of a team of industry leaders and senior<br />

directors from the world of commercial<br />

and consumer credit who took part<br />

in an exclusive executive Forum last<br />

month. Entitled ‘Prison Break – life after<br />

lockdown’, the Forum sought to discuss<br />

what actions each of the delegates had<br />

already taken to cope with the crisis and<br />

how these actions were now helping as<br />

the UK looks to return to work.<br />

Without exception, everyone had been<br />

quick to adopt a working from home<br />

(WFH) strategy which was invariably<br />

already part of a wider Disaster<br />

Recovery (DR) plan. To this end, in<br />

certain cases, it had already been stresstested,<br />

making the transition to a WFH<br />

model comparatively straightforward.<br />

There were some challenges, however,<br />

primarily around technology. There<br />

were also a number of HR issues, but<br />

primarily the strategy was working<br />

well. As one delegate – Glenys Hayward,<br />

Head of <strong>Credit</strong> Risk at the Royal Mail<br />

commented: “Setting KPIs is very<br />

important, but so too is making sure that<br />

everyone in the business is supported.”<br />

Keeping teams engaged has been<br />

another challenge, with executives<br />

finding all manner of ways of<br />

maintaining morale, from simple virtual<br />

coffee breaks, morning huddles and<br />

newsletters, to funny hats, glove puppets<br />

and bingo!<br />


Interestingly, while the majority of<br />

workers, it appears, are more than<br />

happy to work from home,<br />

there are others who are more<br />

anxious to return to a more<br />

traditional office environment.<br />

This was especially true<br />

among some of the<br />

younger members of<br />

staff – typically those<br />

still living at home with their parents<br />

where the WFH concept was simply not<br />

practical. For others, such as those who<br />

lived on their own, there was a similar<br />

desire to return to ‘normal’ as quickly as<br />

possible.<br />

“There is a difference,” Sue Chapple,<br />

Interim CEO of the CICM said, “between<br />

working from home, and being at home<br />

and working. They are not the same.<br />

The former requires more structure<br />

and permanence – ensuring you have<br />

the right ergonomic environment for<br />

example, as well as the technology and<br />

broadband – but that’s very different<br />

from someone having to work out<br />

of their bedroom out of temporary<br />

necessity.”<br />

The crisis has had many positive<br />

impacts: it has led businesses to<br />

reprioritise budgets and investments,<br />

for example, using greater automation<br />

to streamline the credit management<br />

function and further improve<br />

efficiencies. These are investments<br />

that may well have been made over<br />

time INSOLVENCY<br />

but have now been accelerated;<br />

whereas many of the other functions<br />

within a business such as sales or IT<br />

may have been mothballed, the need<br />

for professional credit management<br />

continues.<br />

Talent is another area in which the<br />

crisis could bring benefits. If businesses<br />

look to make WFH a more permanent<br />

strategy, with a blend of office-based and<br />

home-based staff, this will have a direct<br />

impact on the size and location of future<br />

facilities. Rather than being restricted to<br />

recruiting from a particular town or city,<br />

senior executives will therefore have the<br />

pick of a wider talent pool. Debbie Nolan,<br />

Vice President Collections of Arvato<br />

Financial Solutions, sees the upside:<br />

“Without the cost of additional office<br />

space we could conceivably pay our<br />

people more and have access to talent<br />

throughout the UK, rather than being<br />

limited by location.”<br />


Joanna Carnell, Group <strong>Credit</strong> Manager at<br />

TrustFord, believes that the way credit<br />

teams interact in the future is also<br />

likely to change: “It’s an opportunity for<br />

<strong>Credit</strong> to have more leverage within<br />

a business and more influence over<br />

sales and legal, and that has to be a<br />

positive. The challenge is how we can<br />

maintain that influence when we<br />

return to ‘business as usual’.”<br />

Hierarchies, it seems, have been<br />

knocked down and access to their senior<br />

colleagues improved. Sales and account<br />

management teams had also been better<br />

engaged, and the strength or otherwise<br />

of client relationships exposed.<br />

All within the forum also agreed<br />

that their professional qualifications<br />

and training had been essential. It<br />

meant they focussed on the priorities,<br />

like collecting the cash. Success, they<br />

agreed, had not come by accident; it had<br />

come through learning and experience.<br />

Perhaps controversially, all had<br />

experience of COVID-19 as being used<br />

as an excuse by a minority determined<br />

to exploit the crisis for their own gain<br />

and avoid their responsibilities. Some<br />

had experience of businesses arbitrarily<br />

changing their payment terms or, in one<br />

example, settling every invoice at 20<br />

percent less than the invoice amount.<br />

Sue Chapple shared a frustration with<br />

some government policy: “Not everyone<br />

out there is in financial difficulty, nor<br />

are they all out of work, nor are they all<br />

vulnerable. That’s why Knowing Your<br />

Customer is more important than ever.<br />

Professional credit management is<br />

about doing the right thing to the right<br />

customer at the right time and weeding<br />

out those who do genuinely need our<br />

support.”<br />

“There is a difference between<br />

working from home, and being<br />

at home and working. They<br />

are not the same. The former<br />

requires more structure and<br />

permanence – ensuring you<br />

have the right ergonomic<br />

environment for example, as<br />

well as the technology and<br />

broadband – but that’s very<br />

different from someone having<br />

to work out of their bedroom<br />

out of temporary necessity.”<br />

Sue Chapple, Interim<br />

CEO of the CICM<br />

Advancing the credit profession / www.cicm.com / <strong>June</strong> <strong>2020</strong> / PAGE 8


THE<br />


Insolvency in a Coronavirus recession<br />

AUTHOR – David Kerr FCICM<br />

David Kerr FCICM<br />

THE legislation (Corporate<br />

Insolvency & Governance<br />

Bill) anticipated this time<br />

last month has not yet<br />

materialised (at the time<br />

of going to press), so we<br />

are no nearer to knowing the precise<br />

details of the proposed new moratorium<br />

and suspension of wrongful trading<br />

provisions.<br />

The latter has been implemented<br />

elsewhere, in Australia for example,<br />

and will be a subject of much debate for<br />

a while to come. It is not a licence for<br />

directors to carry on regardless – they have<br />

a duty to consider creditors’ interests,<br />

particularly when they know (or should<br />

be aware) that a business is likely to end<br />

up in an insolvent liquidation. Personal<br />

liability for wrongful trading may be<br />

suspended, but as noted in last month’s<br />

article, the director disqualification<br />

provisions remain for those who abuse<br />

the temporary measure, as do the more<br />

serious (but seldom used) fraudulent<br />

trading laws.<br />

The number of insolvencies in Q1<br />

this year fell slightly – a calm before the<br />

storm, no doubt. Anecdotally, Insolvency<br />

Practitioners’ services have been<br />

more focussed on informal guidance<br />

and handholding rather than placing<br />

companies into formal insolvency<br />

processes, but there is an expectation<br />

that, while the Government measures<br />

may be holding off formal appointments,<br />

there is likely to be a surge of company<br />

insolvencies post-lockdown. As furlough<br />

support is reduced in Q3, expect to<br />

see the liquidation and administration<br />

figures rise. And where support is being<br />

provided through loan schemes, expect<br />

some insolvency problems when they are<br />

due to be repaid.<br />

Figures out mid-May from the Office<br />

of National Statistics show that in the<br />

first Quarter this year output fell, with a<br />

much worse downturn expected in the Q2<br />

figures, which will factor in the full effect<br />

of lockdown. These two consecutive<br />

quarters will therefore certainly confirm<br />

that we are officially in a recession, though<br />

confirmation of that will not come until<br />

the Q2 stats are published. Historically,<br />

numbers of insolvencies continue for<br />

up to two years after a recession, and<br />

whilst the present circumstances are<br />

unprecedented and Government is<br />

aiming for a sharp recovery, we might<br />

reasonably expect a good many corporate<br />

casualties for a while yet. A survey by the<br />

Forum for Small Businesses suggests that<br />

one in three of small businesses currently<br />

closed fear that they may never re-open.<br />

It is not a licence for<br />

directors to carry on<br />

regardless – they have a<br />

duty to consider creditors’<br />

interests, particularly when<br />

they know (or should be<br />

aware) that a business<br />

is likely to end up in an<br />

insolvent liquidation.<br />


Meanwhile, other regulatory functions<br />

continue, notwithstanding coronavirus.<br />

The profession’s Joint Insolvency<br />

Committee (JIC) brings together<br />

the regulators, Government and lay<br />

participants to work towards common<br />

standards for insolvency practice. JIC has<br />

been working on a new ethics code for<br />

IPs which came into effect on 1 May this<br />

year, and there is an open consultation<br />

on possible revisions to some of the<br />

Statements of Insolvency Practice (SIPs).<br />

The ethics code has not changed<br />

substantially, but it reflects a number<br />

of refinements that have been under<br />

consideration for a while. Some are<br />

clarifications, some expansions of<br />

existing provisions, and other changes are<br />

designed to align the code with that for<br />

accountants. There is a greater emphasis<br />

on ‘requirements’ – specifying certain<br />

things that ‘shall’ be done by an IP, where<br />

previously there may have been more<br />

scope for different interpretations; that<br />

will help ensure that matters related to<br />

potential conflicts, for example, are dealt<br />

with less ambiguously. There are also new<br />

provisions on referrals and commissions,<br />

IPs’ obligations when they are employees<br />

in a firm, and clearer clauses dealing with<br />

‘best value’ when IPs engage other parties<br />

to do work in an insolvency case - all of<br />

the amendments should serve to better<br />

protect creditors and other stakeholders.<br />

The secondary tier of regulatory<br />

requirements under JIC’s jurisdiction and<br />

promulgated by the professional bodies<br />

is to be found in the SIPs, and some<br />

of these are out for consultation. The<br />

proposals include possible changes to<br />

SIP 3.2 dealing with company voluntary<br />

arrangements (commonly used of late in<br />

the retail sector) –<br />

• An emphasis on the continued viability<br />

of the business<br />

• Making sure there is adequate time for<br />

creditors to consider CVA proposals<br />

• More information on directors, where<br />

relevant<br />

• Alternative options considered by the<br />

company<br />

• Explanations on valuing claims for<br />

voting purposes<br />

• Greater clarity around the costs of the<br />

process; and<br />

• A need to set out what happens if the<br />

CVA fails.<br />

There are also minor changes proposed<br />

to other SIPs, including SIP9 on IP fees,<br />

and CICM will be responding through its<br />

Technical Committee. If you have views<br />

on these changes then you can send your<br />

comments to governance@cicm.com by<br />

8 July; the deadline for responses is 20<br />

July <strong>2020</strong>.<br />

David Kerr FCICM is an insolvency<br />

practitioner with extensive regulatory<br />

experience and a member of the CICM<br />

Technical Committee.<br />

Advancing the credit profession / www.cicm.com / <strong>June</strong> <strong>2020</strong> / PAGE 9


“Government appears to<br />

have let an opportunity to<br />

help the credit community<br />

pass it by. Given the<br />

system was meant to give<br />

reassurance to creditors<br />

about the ‘ethics’ of<br />

connected party deals, it<br />

is also frustrating that the<br />

initiative didn’t garner<br />

more vocal support from<br />

creditor bodies.’<br />

Advancing the credit profession / www.cicm.com / <strong>June</strong> <strong>2020</strong> / PAGE 10


AUTHOR – Sean Feast FCICM<br />


Is the Pre Pack Pool finally sunk?<br />

AUTHOR – Sean Feast FCICM<br />

CREDIT <strong>Management</strong> has learned<br />

that the Pre Pack Pool is in<br />

danger of ceasing its operations.<br />

Indeed, by the time this piece<br />

appears it may well have already<br />

come to pass as the Government<br />

will have no Parliamentary time to introduce<br />

further regulations on Pre Packs before the<br />

May <strong>2020</strong> deadline set when the current referral<br />

system was set up (in 2015). The ‘sunset clause’<br />

as it was dubbed would appear to be setting<br />

rapidly.<br />

The Pool was one of several<br />

recommendations of The Graham Report into<br />

Pre Packs, which resulted in a revised ‘code of<br />

conduct’ (Statement of Insolvency Practice or<br />

SIP 16), which came into force in November<br />

2015.<br />

Its remit was to increase the transparency<br />

around Pre Packs by commenting on<br />

connected party transactions, (considered the<br />

most controversial by creditors in particular).<br />

However, as it was a purely voluntary system,<br />

take-up rates and referrals were very poor. After<br />

a first 14 months when 53 cases were reviewed<br />

representing approximately 25 percent of<br />

connected party deals, over the past three years<br />

of its existence the Pool has seen numbers<br />

decline to around 10 percent of the total.<br />


As early as 2017, The Insolvency Service<br />

implemented a review of the impact of the<br />

voluntary measures. Whilst this was expected<br />

to be completed by May 2018 a passing<br />

reference was made to it in May 2019 when the<br />

report was said to have been completed and<br />

would be released ‘shortly’. In the intervening<br />

two years the rapid decline in referrals led to<br />

calls for the Government to beef up the system<br />

with mandatory referral.<br />

Whilst regulatory bodies such as the ICAEW,<br />

IPA and others including R3 and the British<br />

Property Federation were supportive of the<br />

move, it would appear that BEIS and Insolvency<br />

Service didn’t put too much weight behind the<br />

argument. Indeed, The Insolvency Service<br />

report appears to have disappeared without<br />

trace, having been promised again ‘shortly’ as<br />

recently as January!<br />

Government can claim the delay was caused<br />

by factors such as Brexit, the General Election,<br />

changing Ministers and now of course Covid 19,<br />

but these were not all prevalent over the whole<br />

of the last five years. It does seem that the will<br />

to make changes was no longer there. Perhaps<br />

as Pre Packs became less of a ‘headline issue’<br />

(despite cases such as Debenhams, Interserve<br />

and Johnston Press to name just three of the<br />

more high profile), there was less pressure<br />

from stakeholders to act.<br />

Of course, the demise of the Pool does<br />

not mean a total free-for-all on Pre Packs as<br />

they will still be subject to regulation by the<br />

Insolvency Practitioners regulatory bodies<br />

(RPBs) who in turn report to The Insolvency<br />

Service. Independent valuations, better<br />

marketing and a future viability statement<br />

were all included as requirements of the new<br />

SIP 16 and Insolvency Practitioners will still<br />

be bound by their responsibility to creditors<br />

when dealing with Administrative Pre<br />

Packs. In fairness to the profession, very few<br />

Pre Packs were found to be in breach of the<br />

regulations.<br />

The failure of the voluntary system and the<br />

lack of enthusiasm for a compulsory regime<br />

may cast a shadow once again over Pre Packs<br />

and various questions remain. Was the political<br />

will for change lacking in the early years? Can<br />

the delayed report really be blamed on the very<br />

recent issues Government has had to face? Or<br />

is it merely a convenient time for the ‘problem’<br />

to fade away?<br />

<strong>Credit</strong> <strong>Management</strong> approached Stuart<br />

Hopewell FCICM, a director of Pre Pack Pool<br />

Ltd, for his comments. He said: “Government<br />

appears to have let an opportunity to help the<br />

credit community pass it by. Given the system<br />

was meant to give reassurance to creditors<br />

about the ‘ethics’ of connected party deals, it is<br />

also frustrating that the initiative didn’t garner<br />

more vocal support from creditor bodies.<br />

“As ever, it will be creditors who have most<br />

to lose if we go back to the pre-Graham Report<br />

days of covert deals, tax avoidance and simple<br />

debt dumping which were such a feature of the<br />

old system.”<br />

Advancing the credit profession / www.cicm.com / <strong>June</strong> <strong>2020</strong> / PAGE 11

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Managing <strong>Credit</strong> Through the Recovery.<br />

I<br />

took part recently in two different<br />

forums with senior credit industry<br />

professionals. The first was our<br />

quarterly ‘Think Tank’ which<br />

included a sobering presentation<br />

from the Chief Economist at Dun<br />

& Bradstreet, Markus Kuger. Markus told<br />

us that we were facing one of the biggest<br />

economic meltdowns the world has ever<br />

seen. But he also told us that the recovery<br />

was likely to be swift and dramatic.<br />

The second was a forum of senior credit<br />

professionals as part of our new Managing<br />

<strong>Credit</strong> Through the Recovery programme.<br />

With the immediate crisis coming to<br />

an end, in many ways the difficult work<br />

starts from now as reduced sales and<br />

declining productivity through Q2 start<br />

to hit and collecting the cash becomes<br />

increasingly difficult. It was also sobering<br />

but similarly reassuring to hear how these<br />

professionals were adapting to change,<br />

in some cases implementing disaster<br />

recovery (DR) and working from home<br />

strategies that had already been wellrehearsed.<br />

Whereas some departments<br />

may have been temporarily wrong-footed,<br />

it seems our credit professionals are<br />

already ahead of the curve.<br />

Knowing your customer and<br />

understanding the strengths and frailties<br />

within the supply chain, are both key<br />

imperatives. While always important,<br />

recognising those who can and those<br />

who cannot pay, those in clear financial<br />

distress as opposed to those who are<br />

simply ‘trying it on’, has also taken on a new<br />

significance. Sorting out the fact from the<br />

fiction requires the skill of an experienced<br />

AUTHOR – Sue Chapple FCICM<br />

professional. Indeed, the palette of skills<br />

inherent within our members and their<br />

teams will be used to its full, colourful<br />

extent, from vulnerability to insolvency<br />

and everything in between and even<br />

around the edges.<br />

How we actually emerge from lockdown<br />

is a moot point. Notwithstanding<br />

the Prime Minister’s recently revised<br />

guidance, which has left a great many<br />

businesses confused, everyone has a<br />

different opinion and every opinion is<br />

valid. For we have never been here before.<br />

Customers, clients, employees, partners,<br />

family and friends will all have a view,<br />

and all have different interpretations on<br />

the scale of risk that remains, both in<br />

terms of their own health, and the future<br />

health of our economy.<br />

What we do know is that ‘business as<br />

usual’ still looks some distance away. And<br />

that assumes that the workplace of the<br />

future looks anything like the workplace<br />

of yesterday, which I very much doubt<br />

that it will. What I do know, however,<br />

and what came across loud and clear in<br />

talking to fellow leaders, is that survival<br />

and future success will not come by<br />

accident; it will come to a very large<br />

extent as a result of the quality, training,<br />

and experience of the professional credit<br />

management community.<br />

Look out for our new series of<br />

Managing <strong>Credit</strong> Through the Recovery<br />

initiatives (page 40).<br />

Sue Chapple is interim Chief Executive<br />

of the Chartered Institute of <strong>Credit</strong><br />

<strong>Management</strong> (CICM).<br />

Sue Chapple FCICM<br />

How we actually emerge from lockdown is a moot point.<br />

Notwithstanding the Prime Minister’s recently revised<br />

guidance, which has left a great many businesses confused,<br />

everyone has a different opinion and every opinion is valid.<br />

For we have never been here before.<br />

Advancing the credit profession / www.cicm.com / <strong>June</strong> <strong>2020</strong> / PAGE 13



Funding divorce costs at a time of crisis calls<br />

for a new approach to credit.<br />

AUTHOR – Marcus Holburn<br />

THE impact of COVID-19 Is being<br />

felt across the spectrum, from<br />

business to personal finance,<br />

with no sector or individual<br />

immune. The legal sector is no<br />

different, with those needing<br />

to use the services of the family courts<br />

facing increasing delays in hearing dates and<br />

subsequently, orders made by the court.<br />

For those who began their proceedings<br />

before COVID-19 and who have engaged<br />

solicitors, this delay ultimately means rising<br />

costs. For those who haven’t yet started, this<br />

may mean uncertainty over whether they can<br />

proceed at all.<br />

Much of family law is conducted between<br />

the parties’ solicitors, via letter and email,<br />

but unlike Commercial Law or Conveyancing,<br />

the court plays a central role in charting<br />

the progress of a case, making orders where<br />

required and stepping in when agreements<br />

cannot be reached, either on financial<br />

settlements or cases involving children. Many<br />

family courts have, for years, been struggling<br />

under an increased workload and cases can<br />

take several years to complete. The current<br />

need for social distancing means that those<br />

same courts are having to adapt to new ways<br />

of working, which is taking its toll on timelines<br />

for cases.<br />


Funding for family law typically comes from a<br />

variety of sources. A recent survey from Ampla<br />

Finance found that more than 20 percent of<br />

respondents either liquidated assets or took<br />

out high cost loans or mortgages to raise the<br />

necessary funds. With many cases in Family<br />

Law costing over £30,000, the cost of this<br />

credit and therefore any delays in concluding<br />

the proceedings can mount up.<br />

The use of credit card loans to pay fees has<br />

long been a popular option for those looking<br />

to fund unexpected life events such as divorce,<br />

but, as the lockdown extends, costs are skyrocketing.<br />

On the 9 April the Government<br />

took steps to introduce payment freezes on<br />

credit cards and personal loans for up to<br />

three months, targeted at those struggling<br />

to manage their debt. This was extended to<br />

include store cards, catalogue credit and<br />

car financing on 14 April, but this is only a<br />

temporary fix. These freezes are not free.<br />

Customers will still have to pay the accrued<br />

interest once the deferral period ends and the<br />

ongoing cost of maintaining this credit, at a<br />

time when income is being squeezed from all<br />

angles, simply isn’t an option for some.<br />

COVID-19 is also impacting the availability<br />

of credit for many. It has been reported that<br />

people who have been furloughed have been<br />

refused lines of credit, based on an assumption<br />

that their furlough may lead to redundancy.<br />

Just when workers are most strapped for<br />

cash, a lack of borrowing options places<br />

further pressure on a difficult situation. Then<br />

consider those who have no personal income<br />

or credit history, maybe because they have<br />

been a stay at home parent and not managed<br />

their personal finances for some time. At the<br />

best of times they will struggle to borrow<br />

money; during COVID-19, this option is firmly<br />

off the table.<br />

When once upon a time the clients for<br />

Family Law Solicitors may have relied on their<br />

savings, borrowed from the ‘bank of Mum and<br />

Dad’ or even asked the other party to fund<br />

legal costs, the reality may now be that these<br />

options are no longer available. So, what can<br />

you do if you need to continue or begin legal<br />

proceedings in this environment but can’t get<br />

credit?<br />


In these cases, consideration should be given<br />

to specialist lenders and their products.<br />

Lenders have developed lending products<br />

which are specifically designed to pay the<br />

fees and other costs associated with divorce<br />

or financial remedy proceedings. In some<br />

circumstances, they are also able to provide<br />

funds to plug short-term gaps in maintenance<br />

payments for everyday costs. The cost of<br />

credit in many cases is equivalent to, or lower<br />

than, credit cards or other types of borrowing.<br />

Additionally, all fees and interest are rolled up<br />

and added to the final balance of the loan.<br />

These loans only attract interest on what<br />

is utilised, so the additional cost of credit<br />

incurred due to delays in court are kept at a<br />

minimum. As the use of alternative dispute<br />

resolution methods (outside of court) increase,<br />

where cases settle earlier than expected or the<br />

fees don’t reach initial estimates, customers<br />

aren’t left having to foot the bill for a loan they<br />

didn’t need.<br />

Uniquely with this type of lending, nothing<br />

is repayable until the case is settled, and the<br />

customer has received the funds they were<br />

awarded. As a result, no regular repayments<br />

Funding for family<br />

law typically comes<br />

from a variety of<br />

sources. A recent<br />

survey from Ampla<br />

Finance found that<br />

more than 20 percent<br />

of respondents either<br />

liquidated assets or<br />

took out high cost<br />

loans or mortgages to<br />

raise the necessary<br />

funds.<br />

Advancing the credit profession / www.cicm.com / <strong>June</strong> <strong>2020</strong> / PAGE 14


Much of family law is conducted between the parties’ solicitors,<br />

via letter and email, but unlike Commercial Law or Conveyancing,<br />

the court plays a central role in charting the progress of a case,<br />

making orders where required and stepping in when agreements<br />

cannot be reached, either on financial settlements or cases<br />

involving children.<br />

are required, and customers don’t need to worry<br />

about finding the money each month to pay<br />

interest or charges. Some providers will also<br />

fund arbitration and other forms of alternative<br />

dispute resolution, which are gaining real<br />

popularity in the COVID-19 climate.<br />

In this type of lending, an individual’s credit<br />

history is a factor, but not necessarily the key<br />

consideration. Under the current challenging<br />

financial circumstances, a pragmatic approach<br />

towards a customer’s credit history may be<br />

called for, to ensure lending is accessible for<br />

many who may struggle to meet mounting legal<br />

costs. It is worth remembering that those going<br />

through a divorce might not necessarily have<br />

a stellar credit rating, especially if they haven’t<br />

managed their personal finances for some<br />

time. Each case should be assessed individually,<br />

with credit history being only one aspect of<br />

underwriting, rather than the deciding factor.<br />


The primary assessment should generally be<br />

made on the assets in the marital pot, which<br />

are due to be divided in the settlement. The<br />

solicitor presents a likely settlement value<br />

and an estimate of the fees required to realise<br />

that outcome – this forms the basis of what<br />

can be lent. The lender subsequently takes an<br />

assignment over the relevant assets in the case<br />

and works with the solicitor to ensure funds<br />

Marcus Holburn<br />

The primary<br />

assessment should<br />

generally be made<br />

on the assets in<br />

the marital pot,<br />

which are due to<br />

be divided in the<br />

settlement.<br />

are repaid from the settlement proceeds. This<br />

assessment is made in the same way, whether<br />

the funding is for straightforward financial<br />

proceedings or more complex cases.<br />

COVID-19 has had an impact on underwriting<br />

this type of lending, certainly in terms of<br />

valuing assets for the medium to long term.<br />

These concerns can generally be mitigated<br />

by using conservative valuations and sensible<br />

loan-to-value ratios, to not only mitigate risk<br />

but crucially to ensure that customers suffer<br />

no detriment as a result of taking this kind of<br />

loan. Customer vulnerability and affordability<br />

of lending are also key considerations for all<br />

lenders ensuring fair and transparent options<br />

for customers.<br />

Whilst specialist litigation funding isn’t<br />

appropriate for all cases, in the COVID-19<br />

environment, the type of bespoke product<br />

offered by providers in this area is proving a<br />

lifeline for many customers who find themselves<br />

struggling to find affordable credit. Not all<br />

credit is created equal and, when facing an<br />

unprecedented situation, a different approach<br />

means that the financial support for those who<br />

need it to see them through an already difficult<br />

time is readily available.<br />

Marcus Holburn, Finance Director,<br />

Ampla Finance<br />

Advancing the credit profession / www.cicm.com / <strong>June</strong> <strong>2020</strong> / PAGE 15

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Advancing the credit profession / www.cicm.com / <strong>June</strong> <strong>2020</strong> / PAGE 16


Avoid the ‘pay-it-forward’<br />

cash management trap<br />

AUTHOR – Bethan Evans<br />

SMALL and medium-sized<br />

enterprises account for 99.9<br />

percent of private sector<br />

businesses in the UK , and the vast<br />

majority employ fewer than 50<br />

people. Despite their diminutive<br />

size, SMEs generate turnover of £2.2 trillion<br />

per annum and make a valuable contribution<br />

to the UK economy. They are the engine of UK<br />

plc and their importance must be prioritised<br />

when visualising the recovery that will come<br />

after the economic downturn.<br />

Being an insolvency practitioner as well<br />

as a consumer, I am naturally cautious about<br />

purchasing gift cards for my friends and<br />

family, and I am generally quite sceptical of<br />

the so-called ‘pay-it-forward’ movement. This<br />

is likely a result of seeing what happens when<br />

businesses fail. It is also because rather than<br />

bringing additional cash into the business, the<br />

way I see it, such activities bring additional<br />

liability.<br />

Cash is the lifeblood of any business and<br />

keeping it flowing is key to long-term survival.<br />

It comes in through sales of goods or services<br />

and goes out to pay suppliers, overheads and<br />

employees, in what is termed the working<br />

capital cycle. In the current crisis, if a business<br />

was suddenly unable to trade, it could fall<br />

back on government support. With some<br />

quick thinking, it might furlough staff and<br />

stop supplies in order to minimise the drain<br />

on cash.<br />

Dealing with operational overheads is not<br />

so straightforward however. It is not possible<br />

to put a stop on key costs such as insurance,<br />

energy and rent. These will continue to drain<br />

cash out of the business, although in some<br />

cases it may be possible to negotiate rent<br />

holidays. For many owner managers, being<br />

furloughed is not an option, and yet they still<br />

need to eat and heat their homes. This puts an<br />

additional burden on the cash of the business<br />

and increases the need for innovative thinking.<br />

Some businesses have been able to adapt<br />

their way of operating - finding new ways<br />

to deliver their goods or services, whilst<br />

complying with social distancing rules. There<br />

has been a rise in local delivery services from<br />

local butchers, greengrocers, restaurants and<br />

pubs to name just a few. These are businesses<br />

that may not have offered home deliveries<br />

previously, but have found that it now makes<br />

good sense.<br />

This works for businesses that can open and<br />

fulfil their role in society, but there are still<br />

many that cannot. The likes of the hairdresser,<br />

the beauty therapist and the businesses<br />

creating fun days out for the family. All are<br />

examples of businesses that must remain<br />

closed and many others in their supply chains<br />

have been affected too. Facing such tough<br />

restrictions, some consumer-facing businesses<br />

have been offering gift vouchers in an attempt<br />

to make some sales at a difficult time. As well<br />

as generating cash, such purchases have been<br />

proving popular with customers who enjoy the<br />

buzz from having a shopping trip to look<br />

forward to.<br />

But when ‘normal’ trading re-starts, where<br />

will the cash come from? Those businesses<br />

that have concentrated on selling vouchers<br />

and gift cards to get through the crisis, will<br />

find that they are effectively now working for<br />

‘free’. How long will they be able to sustain<br />

this?<br />

To ensure businesses don’t fall into the<br />

‘pay-it-forward’ cash management trap<br />

when trading resumes, careful planning<br />

and forecasting is essential. For example,<br />

consideration must be given to the expiry<br />

date of the voucher to provide some value<br />

and certainty to the customer. No customer<br />

wants a voucher redeemable only within the<br />

next three months, as the business may not<br />

be open in that time and even if it were, it<br />

may have insufficient appointment slots or<br />

tickets due to a rise in demand. On the other<br />

hand, the entrepreneur will not want to ‘work<br />

for free’ for three months, as this would put<br />

considerable pressure on cashflow and may<br />

not be sustainable. A longer period would<br />

allow the customer some flexibility and help<br />

to dilute the effect of limited cashflow over a<br />

longer period of time.<br />

Many owner managers who have had<br />

no choice but to shut up shop during the<br />

lockdown, have already begun planning for the<br />

life the other side of the Covid-19 crisis. Will<br />

they continue with home deliveries for a while<br />

longer, and could gift vouchers become part<br />

of their core offering? Those that have taken<br />

a balanced approach to adapting their trading<br />

activities during the crisis and stayed focused<br />

on the principles of good cash management,<br />

will be ready to take advantage of any market<br />

revival. This could be good news for them and<br />

their supply chains.<br />

For expert advice and support with your<br />

credit management strategy, contact<br />

Bethan Evans or the creditor services team at<br />

Menzies LLP.<br />

+44 2920 447 512<br />

bevans@menzies.co.uk<br />

www.menzies.co.uk/creditor-services<br />

Bethan Evans<br />

Advancing the credit profession / www.cicm.com / <strong>June</strong> <strong>2020</strong> / PAGE 17

COVID-19<br />

International Rescue<br />

Despite government efforts to prevent an economic<br />

catastrophe, a credit squeeze is expected. But how big<br />

and for how long?<br />

AUTHOR – Lawrie Holmes<br />

AS there are so many<br />

unknowns about the<br />

Coronavirus, so too the<br />

possible outcomes for<br />

the economy and future<br />

credit conditions remain<br />

vague. But experts are beginning to piece<br />

together the likely economic impacts of<br />

the pandemic and the unprecedented<br />

rescue efforts being undertaken around<br />

the world.<br />

In the UK, a series of economic<br />

bazookas in the form of government grants<br />

and loans, reminiscent of the emergency<br />

package put in place to counter the global<br />

financial crisis a decade ago, have been<br />

launched. But despite commitments to<br />

unleash whatever firepower is necessary<br />

to head off economic collapse, there is<br />

growing concern about an imminent<br />

credit squeeze. A broad consensus is<br />

developing that the UK and much of the<br />

world will experience a recession as a<br />

result of the action taken by governments<br />

to limit the spread of Covid-19.<br />

On 7 May the Bank of England said the<br />

UK economy could contract by as much as<br />

25 percent in value in the second quarter<br />

of <strong>2020</strong>, on top of a three percent fall in the<br />

first quarter. “Compare these estimates<br />

with the 2.2 percent contraction in the<br />

fourth quarter of 2008 during the recent<br />

financial crisis, and we begin to see the<br />

scale of the contraction being forecast,”<br />

says Dr Nirmala Lee, associate professor<br />

at London Metropolitan University.<br />

“The contraction and the ensuing<br />

credit squeeze, are likely to affect some<br />

sectors more than others as battered<br />

lenders hit by bad debts and loan losses<br />

contract the supply of credit available:<br />

larger businesses are likely to be favoured<br />

by lenders in their attempt to ration credit<br />

in their flight to quality, and smaller<br />

businesses, many of whom may have all<br />

but succumbed during the lockdown can<br />

never hope to enter the recovery phase,”<br />

says Dr Lee.<br />

Dr Nikolaos Antypas, lecturer in<br />

finance at Henley Business School, says a<br />

credit squeeze is on the way in the UK, but<br />

with some caveats. He says the decision<br />

by the UK government and the Bank of<br />

England to pump money into the economy<br />

may alleviate some of the repayment risks<br />

faced by individuals and businesses.<br />

“But if the market remains in lethargic<br />

pace for much longer, credit could be<br />

gradually squeezed to levels seen during<br />

the 2008 crisis. This scenario is especially<br />

dire since the cost of new debt has been<br />

at historically low levels for most market<br />

participants,” he says.<br />


At the end of April research firm Capital<br />

Economics predicted UK banks would<br />

have to absorb about £50bn of loan losses<br />

in the current crisis compared to £80bn<br />

written off in the global financial crisis<br />

(GFC) but added this could get close to<br />

the GFC level. ‘While this number sounds<br />

The contraction and<br />

the ensuing credit<br />

squeeze, are likely to<br />

affect some sectors more<br />

than others as battered<br />

lenders hit by bad debts<br />

and loan losses contract<br />

the supply of credit<br />

available.<br />

large it would only be about 13 percent<br />

of UK bank’s Core Tier One Capital and<br />

would only reduce the all-important Core<br />

Tier One Capital Ratio from 15.6 percent<br />

to 13.6 percent,’ the firm said in a report<br />

published then.<br />

Andrew Wishart, a UK economist at<br />

Capital Economics, says he is positive<br />

about the resilience of the banking<br />

sector: “For loans taken under one of the<br />

Government’s schemes, banks should be<br />

able to recoup much of the lost capital.<br />

But loans made before the crisis will<br />

have to be written off entirely. The Bank<br />

of England’s latest stress test suggests<br />

banks can cope with these losses. And<br />

government guarantees reduce the risk of<br />

a credit squeeze.<br />

“So far, it doesn’t look like a credit<br />

squeeze is materialising that could<br />

prolong the crisis. However, were the<br />

economy to struggle to recover as quickly<br />

as most envisage or the government to<br />

withdraw its guarantees of new loans to<br />

business, a sharp pull back in lending<br />

would be likely,” he adds.<br />

The Bank of England says of the<br />

resilience of the financial sector: “We<br />

have tested the major UK banks. This<br />

has shown that they are strong enough<br />

to continue lending during this period of<br />

severe economic disruption. By expanding<br />

lending, banks will support the economy<br />

and limit losses to themselves.”<br />


Figures from UK Finance, which<br />

represents banks and other financial<br />

institutions, said: “By the end of April<br />

lenders provided almost 700,000 payment<br />

holidays on credit cards and 470,000 on<br />

personal loans for customers facing cashflow<br />

problems due to the Coronavirus.<br />

Over 27 million customer accounts<br />

were offered the option of interest-free<br />

borrowing for three months on the first<br />

£500 of their arranged overdraft.”<br />

By 12 May around £15bn of financing<br />

was provided to 304,000 businesses<br />

through the Bounce Back Loan Scheme<br />

(BBLS) targeted at sole traders and<br />

small firms, the Coronavirus Business<br />

Interruption Loan Scheme (CBILS) for<br />

small and medium sized enterprises<br />

(SMEs) and the Coronavirus Large<br />

Business Interruption Loan Scheme<br />

(CLBILS) for larger businesses.<br />

Damian Hales, a partner at Big Four<br />

firm Deloitte who specialises in credit risk<br />

across retail, commercial and corporate<br />

banking, says factors based on modelling<br />

and human behaviour could create a<br />

credit squeeze in the longer term: “A<br />

credit squeeze is expected,” he says. “But<br />

the question is: how big will it be and for<br />

how long will it last?”<br />

He says that although impairments<br />

are unlikely to breach stress test levels<br />

for banks, concerns around accounting<br />

standard IFRS9, the impairment rules<br />

relating to future macroeconomic events,<br />

will result in pessimistic economic<br />

assumptions and therefore in turn lead<br />

to a change in human behaviour: “And<br />

because of that, there could be less<br />

lending – because banks won’t want to<br />

breach their own risk appetite levels,”<br />

he says. Banks will also seek to conserve<br />

capital despite recent pronouncements<br />

Advancing the credit profession / www.cicm.com / <strong>June</strong> <strong>2020</strong> / PAGE 18

COVID-19<br />

AUTHOR – Lawrie Holmes<br />

around relaxing the capital rules. “The large<br />

banks won’t want first mover disadvantage, so<br />

won’t want to dip into these new capital buffers,<br />

because of the potential market perception of<br />

2008 all over again,” he says. He also believes<br />

that automated decision-making may mean<br />

more credit requests will be refused.<br />

Banks’ lending will also be affected by<br />

human factors: “Whether its manual credit<br />

decision-making or credit committees deciding<br />

on large corporate client lending, assumptions<br />

will become more cautious, so borderline<br />

cases may get refused,” he adds. And in the<br />

medium term, banks will seek to cut costs<br />

as revenue is falling: “Certain departments,<br />

certain products will be cut, and there increasing<br />

further the potential risk of closing off funding,”<br />

he continues.<br />

On top of all of this, banks are struggling<br />

with capacity. At a time when they are being<br />

overwhelmed with requests, bank staff are<br />

isolating because of Covid-19: “Some banks<br />

may be less likely to process as many loans, so<br />

further constraining credit,” he warns.<br />


Perhaps the biggest concern for many observers<br />

is what happens when the vast amounts<br />

of capital in the form of loans or grants to<br />

companies needs to be paid back.<br />

Most businesses receiving state support will<br />

have irrevocable revenue losses, says Henley<br />

Business school’s Dr Antypas: “Even if the<br />

pandemic is over by the end of summer <strong>2020</strong>,<br />

which is rather optimistic, consumers will not<br />

make up for the consumption lost during the<br />

lockdown. People will not buy more dinners,<br />

coffees, electronics to make up for the lost time,<br />

especially since most of them have had some<br />

sort of lost income themselves.<br />

“This holds for both retail and wholesale<br />

commerce. Therefore, one of the most optimistic<br />

scenarios sees businesses after the crisis having<br />

the same revenues but owing a considerable<br />

amount to the government. For businesses<br />

If the market<br />

remains in<br />

lethargic pace for<br />

much longer, credit<br />

could be gradually<br />

squeezed to levels<br />

seen during the<br />

2008 crisis.<br />

that have been operating on thin margins, the<br />

burden of the loan may be the last drop that will<br />

lead to a series of bankruptcies,” he says.<br />

A seemingly benevolent approach taken<br />

by HMRC, dropping pursuit of non-payment<br />

of taxes in favour of prioritising support for<br />

individuals and businesses through payment<br />

deferrals, in the long term won’t change the<br />

situation, says Metropolitan University’s Dr Lee.<br />

“We should expect that the tax collection<br />

will resume as normal, since the government<br />

has to meet unforeseen financial needs in<br />

NHS and social support. Any relaxation of tax<br />

collection will probably come to bite us harder<br />

down the line, considering the sustained<br />

economic damage of the pandemic, as well as<br />

the completion of Brexit,” she says.<br />

From the banks’ perspective, Deloitte’s<br />

Hales says financial institutions are struggling<br />

with how to manage the point where payment<br />

holidays unwind: “Call volumes are likely to<br />

rise sharply, but at that point you have to assess<br />

each individual customer on their own merit, as<br />

circumstances will differ considerably, unless<br />

the government intervenes again-say on another<br />

wave of mortgage holidays. Otherwise, banks<br />

will have to introduce new technology and ramp<br />

up call centre capability,” he says.<br />

Banks are also seeking clarity on how long<br />

government schemes are set to continue for<br />

corporate clients: “Will it be another wave and<br />

another wave, if so they will say ‘I’m not writing<br />

it on my balance sheet’.<br />

Dr Antypas believes the UK government,<br />

which was about to shift to higher spending<br />

after years of austerity, will have to address<br />

the impact of reduced tax revenue for the<br />

government: “This may mean we have to relapse<br />

into a state of austerity, unless the government<br />

finds an unforeseen way of fiscal spending that<br />

will increase economic activity for the years<br />

to come, considerably and sustainably. If the<br />

pandemic has a sustained effect on the country's<br />

economy, the state is expected to suffer from<br />

a deficit for at least a few years, which can<br />

increase the risk of a fiscal debt crisis,” he adds.<br />

However, Dr Lee takes a more sanguine<br />

view: “The economist John Maynard Keynes<br />

argued that deficit spending and debts incurred<br />

to sustain spending can help countries climb<br />

out of economic recession. Eventual fiscal<br />

adjustments can bring the debt dynamics back<br />

to sustainable levels,” she says.<br />

Dr Lee says the UK government may attempt<br />

to balance its books by resorting to increased<br />

levels of borrowing in the form of long-term<br />

debt. “There was patriotic fervour for the<br />

purchase of war bonds that were issued to the<br />

public to help the government raise finance to<br />

fund the cost of the second world war.<br />

“If there is similar appetite among the public<br />

to support the government’s corona war efforts,<br />

‘corona bonds’ could be issued on the lines of<br />

‘war bonds’ to help the government raise long<br />

term debt to meet all the money being paid out,”<br />

she concludes.<br />

Advancing the credit profession / www.cicm.com / <strong>June</strong> <strong>2020</strong> / PAGE 19


SWAIN’S<br />

WORLD<br />

Sean Feast FCICM speaks to Paula Swain<br />

about commercial recoveries, partnering<br />

with the CICM, and why she has a need<br />

for speed.<br />

AS a youngster, Paula Swain<br />

never really had a definitive<br />

plan as to what she wanted to<br />

be when she grew up. What<br />

she did have in abundance,<br />

however, was a resilience that<br />

came with a peripatetic upbringing.<br />

“I had globetrotting parents,” she explains,<br />

“which means although I was born in<br />

Berkshire, I grew up mainly in southern<br />

Africa. I remember being at school by a<br />

diamond mine in the Kalahari and I was the<br />

only white girl in the class. I think that’s where<br />

my resilience and flexibility comes from.”<br />

After returning to the UK and finishing her<br />

education, Paula won a place at the University<br />

of Southampton in 1993 to study Law but<br />

still without any clear plan as to what she<br />

wanted to do next. She took various jobs at<br />

Westpac and Securicor on the Channel Islands<br />

before joining the Fraud Department within<br />

Vodafone in the days of ‘cloned phones.’ She<br />

remembers those days with great affection:<br />

“On my last day I received a letter by fax that<br />

purported to come from the Commissioner<br />

of the Metropolitan Police that requested my<br />

personal attendance at a fraud trial in London.<br />

It was, of course, a practical joke instigated by<br />

my boss.”<br />


With her degree she began her legal training<br />

in Bournemouth, becoming a Partner within<br />

seven years. It was an interesting time in<br />

which she added to her knowledge of various<br />

aspects of consumer credit (including motor<br />

finance litigation), banking (including<br />

mortgages), and commercial recoveries<br />

(including disputes).<br />

Among her colleagues at this time was<br />

Karen Savage FCICM, and the two of them<br />

left Lester Aldridge at the same time to join<br />

Shoosmiths: “I had some good times at Lester<br />

Aldridge, but the time had come to broaden<br />

my horizons.”<br />

Shoosmiths is a national law firm operating<br />

from a network of 13 offices, and with client<br />

companies on every part of the business<br />

growth cycle. The company is a national<br />

market leader in business-to-business debt<br />

recovery, providing advice and recovery<br />

solutions to companies in a wide range of<br />

industry sectors in all legal jurisdictions of<br />

the UK. Its teams work closely with credit<br />

teams to recover commercial debts as quickly<br />

and efficiently as possible; they also deliver<br />

a range of consultancy services designed to<br />

improve cash flow and to reduce cost.<br />

In joining Shoosmiths, the remit was to<br />

establish a new commercial recoveries team<br />

in Solent and augment and expand the team<br />

in Reading (Thames Valley). When Karen<br />

left to join Azzurro (see <strong>Credit</strong> <strong>Management</strong><br />

issue April), Paula was able to stamp her own<br />

identity on the business:<br />

“I did a complete drains-up review of the<br />

business, our processes and our relationships,<br />

and this included looking at certain clients<br />

and making some difficult decisions<br />

regarding future ‘fit’. We had a clear vision for<br />

the team and what we wanted to achieve, and<br />

that meant a particular focus on the quality of<br />

what we produce.”<br />


Her new team has an interesting dynamic,<br />

spanning several generations. Paula enjoys<br />

the mix and enjoys the spirit within the team<br />

she works alongside: “It may sound trite, but<br />

we genuinely care about our clients. We enjoy<br />

going into battle for them and celebrate our<br />

successes.<br />

“When you’re 60 or you’re 18, it’s really<br />

interesting to see how different ages receive<br />

and process information, but what is common<br />

across the team is the shared desire to succeed.<br />

It’s what gets us all out of bed in the morning.”<br />

Debt recovery requires a range of different<br />

skills, Paula says. Sometimes it’s about<br />

understanding how a small query can be<br />

prevented from turning into a major problem.<br />

The ability to empathise with people is critical<br />

as a route to opening doors and starting a<br />

conversation, but so too is knowing when<br />

Advancing the credit profession / www.cicm.com / <strong>June</strong> <strong>2020</strong> / PAGE 20


AUTHOR – Sean Feast FCICM<br />

“I had globetrotting parents, which means although<br />

I was born in Berkshire, I grew up mainly in<br />

southern Africa. I remember being at school by a<br />

diamond mine in the Kalahari and I was the only<br />

white girl in the class. I think that’s where my<br />

resilience and flexibility comes from.”<br />

changes they need to make to stop losing<br />

money: “A good legal partner can help you<br />

drive the conversation,” she explains, “but<br />

that’s of little use if the person at the other<br />

end isn’t listening!”<br />

Paula is a keen champion of credit<br />

managers and the CICM in particular,<br />

and is an active member of the CICM’s<br />

Technical Committee. She was delighted,<br />

therefore, when Shoosmiths was chosen<br />

by CICM as its new exclusive legal<br />

partner for 2019-20. “The Institute is<br />

a byword for excellence, so working<br />

more closely with the CICM makes<br />

absolute sense to us and will,<br />

I believe, be great for both our<br />

respective organisations. Our UKwide<br />

office network maps exactly<br />

with CICM’s own scope of operations.<br />

We have great hopes for the tremendous<br />

synergies this represents.”<br />

Paula says that she personally likes<br />

learning from mistakes (“Perhaps that’s<br />

partly to do with my upbringing,” she<br />

jokes) and has ambitious plans for the<br />

future in terms of further expanding the<br />

team. (At the moment the team comprises<br />

more than 40 specialists in Solent, Belfast<br />

and Edinburgh.)<br />

Paula Swain<br />

to be assertive, especially in situations<br />

where sides have become entrenched.<br />

Within Shoosmiths there is a defended<br />

team of lawyers should their services be<br />

required but litigation is not the preferred<br />

route to debt resolution:<br />

“We try very hard to avoid our clients<br />

ever having to go into a courtroom,” Paula<br />

says, “because it can be a rough place to<br />

be and you are in the hands of a judge who<br />

could easily decide against you and the<br />

cost to appeal can be disproportionate.<br />

Mediation is often the best route.”<br />

The biggest challenge in the credit<br />

management space, Paula believes, is<br />

the loss of experience: “People with<br />

40+ years of experience are leaving the<br />

industry, either through retirement or<br />

from programmes to reduce headcount,<br />

and that experience is almost impossible<br />

to replace. Who do the people who replace<br />

them learn from? How do they know<br />

what’s happening in their business and<br />

what trends they should be following<br />

or changes they need to make? Who’s<br />

regularly reviewing a client’s Terms and<br />

Conditions?<br />


“I fear we are not only losing that core<br />

credit control experience but that in some<br />

larger corporates there is a disconnect<br />

in terms of whose responsibility it is. Is<br />

it the Financial Director’s responsibility,<br />

for example, to review Ts and Cs or the inhouse<br />

counsel? When we are acting for a<br />

larger firm, we might have a relationship<br />

with the in-house legal team and yet never<br />

meet the FD.”<br />

<strong>Credit</strong> managers, she says, are constantly<br />

having to demonstrate their value, and<br />

Paula often acts in a consultancy role to<br />

help businesses understand where they<br />

may be haemorrhaging cash and the<br />


So how does she see the business in three<br />

years’ time?<br />

“Much bigger than it is currently and<br />

in more locations,” she says (at the time<br />

of going to press, a new team was joining<br />

Paula in Birmingham). “In many ways, our<br />

office in Solent has a small business ‘feel’<br />

to it but with the advantage of actually<br />

being part of a major business.<br />

“Things tend to happen very fast around<br />

here,” she adds.<br />

Speed is something that Paula has never<br />

been afraid of: “I’ve always enjoyed fast<br />

cars and fast ribs, though I don’t own<br />

either at the moment,” she responds,<br />

almost wistfully.<br />

As well as leading Shoosmiths’ debt<br />

recovery team, Paula is also the Partner in<br />

charge of the whole of the Solent office.<br />

She is similarly busy outside of work,<br />

engaging with local firms as a Director of<br />

the Solent Local Enterprise Partnership.<br />

Hearing the experiences of businesses<br />

in diverse sectors, from Airbus to Red<br />

Funnel Ferries, adds to her learning:<br />

“These businesses are really close to<br />

what’s happening and it’s amazing how<br />

much you can learn about them and how<br />

they interact.”<br />

Advancing the credit profession / www.cicm.com / <strong>June</strong> <strong>2020</strong> / PAGE 21


Testing Times<br />

The latest payment performance statistics<br />

highlight the early impact of COVID-19.<br />

THE Coronavirus pandemic is<br />

impacting all industries and<br />

sectors. It is also leading to a shift<br />

in the roles and requirements of<br />

credit management professionals,<br />

with more focus on listening to<br />

customers and being more understanding of<br />

their circumstances and struggles with debts<br />

and finances.<br />

<strong>Credit</strong> professionals are expected to agree to<br />

new and extended payment terms and introduce<br />

new payment plans to help ensure that cashflow<br />

is optimal. This is having a knock-on effect on<br />

payment terms across the board in the UK and on<br />

a global scale, something that will likely worsen<br />

as the crisis continues. The average Days Beyond<br />

Terms (DBT) figures across regions and sectors<br />

increased by 1.3 and 2.1 days respectively.<br />


The sector standings highlight the struggles<br />

of many, with 17 of the 22 monitored sectors<br />

experiencing increases to payment terms. For<br />

International Bodies, the impact has been<br />

devastating, with an unprecedented increase of<br />

18.2 days to its terms, meaning its overall DBT<br />

now stands at 42.1 days.<br />

These are extraordinary times, and this is an<br />

extreme case, no other sector has been affected as<br />

badly, not yet anyway. Entertainment (+8.3 days),<br />

Hospitality (+4.5 days) and Education (+3.6 days)<br />

follow in terms of worst affected sectors. However,<br />

the sheer volume of increases throughout the<br />

standings (77 percent) is a real cause for concern<br />

and something that may only get worse.<br />

However, it feels especially important now<br />

to promote some positivity, and five sectors<br />

did perform well and managed to<br />

reduce payment terms. The biggest<br />

improvement came from the Mining<br />

and Quarrying sector, reducing its<br />

DBT by 5.1 days. Health and Social<br />

(-1.8 days), Energy Supply (-1.4<br />

days) and Business from Home<br />

(-0.6 days) also did well.<br />


At a regional level, the impact has not been<br />

as drastic, but similarly the majority are<br />

struggling, with eight of the 11 UK regions<br />

moving in the wrong direction and seeing<br />

increases to payment terms.<br />

Scotland has been worst affected, with its<br />

DBT increasing by 3.5 days. Northern Ireland<br />

has returned to the bottom of the standings<br />

following an increase of 3.1 leaving its overall<br />

DBT at 16.3 days. The East Midlands (+2.9<br />

days), North West (+2.4 days) and South East<br />

(+1.9 days) also struggled.<br />

Three regions, however, did improve, and<br />

managed to reduce their payment terms. The<br />

West Midlands is now the best performing<br />

region, with a reduction of 1.2 days taking<br />

its overall DBT to 11 days. Yorkshire and<br />

Humberside (-0.7 days) and East Anglia (-0.5<br />

days) also managed to move in the right<br />

direction.<br />

Advancing the credit profession / www.cicm.com / <strong>June</strong> <strong>2020</strong> / PAGE 22


Data supplied by <strong>Credit</strong>safe Group<br />

Top Five Prompter Payers<br />

Region April 20 Change from March 20<br />

West Midlands 11 -1.2<br />

Yorkshire and Humberside 11.2 -0.5<br />

Wales 11.3 0.3<br />

South West 11.5 1.3<br />

East Anglia 12.2 -0.7<br />

Getting Worse<br />

International Bodies 18.2<br />

Entertainment 8.3<br />

Hospitality 4.5<br />

Education 3.6<br />

Professional and Scientific 3.6<br />

IT and Comms 3<br />

Water and Waste 2.8<br />

Real Estate 2.7<br />

Agriculture, Forestry & Fishing 2.3<br />

Business Admin & Support 1.7<br />

Financial and Insurance 1.6<br />

Public Administration 1.5<br />

Manufacturing 0.9<br />

Other Service 0.9<br />

Transportation and Storage 0.7<br />

Construction 0.6<br />

Bottom Five Poorest Payers<br />

Region April 20 Change from March 20<br />

Northern Ireland 16.3 3.1<br />

East Midlands 14.8 2.9<br />

North West 14.6 2.4<br />

Scotland 13.7 3.5<br />

South East 12.4 1.9<br />

Getting Better<br />

Mining and Quarrying -5.1<br />

Health & Social -1.8<br />

Energy Supply -1.4<br />

Dormant -1<br />

Business from Home -0.6<br />

Top Five Prompter Payers<br />

Region April 20 Change from March 20<br />

Health & Social 7.9 -1.8<br />

Agriculture, Forestry & Fishing 8.7 2.3<br />

Public Administration 9.4 1.5<br />

Wholesale and retail trade 9.8 0.2<br />

Other service 10.1 0.9<br />

Bottom Five Poorest Payers<br />

Region April 20 Change from March 20<br />

International Bodies 42.1 18.2<br />

Mining and Quarrying 20.9 -5.1<br />

Transportation and Storage 18 0.7<br />

Dormant 17.5 -1<br />

Energy Supply 16.2 -1.4<br />

Wholesale and retail trade 0.2<br />

Region<br />

Getting Better – Getting Worse<br />

-1.2<br />

-0.7<br />

-0.5<br />

3.5<br />

3.1<br />

2.9<br />

2.4<br />

1.9<br />

1.3<br />

1.3<br />

0.3<br />

West Midlands<br />

East Anglia<br />

Yorkshire and Humberside<br />

Scotland<br />

Northern Ireland<br />

East Midlands<br />

North West<br />

South East<br />

South West<br />

London<br />

Wales<br />



3.1 DBT<br />

SOUTH<br />

WEST<br />

1.3 DBT<br />

SOUTH<br />

EAST<br />

1.9 DBT<br />

WALES<br />

0.3 DBT<br />


3.5 DBT<br />

NORTH<br />

WEST<br />

2.4 DBT<br />

WEST<br />


-1.2 DBT<br />



-0.5 DBT<br />

EAST<br />


2.9 DBT EAST<br />

ANGLIA<br />

-0.7 DBT<br />

LONDON<br />

1.3 DBT<br />

Advancing the credit profession / www.cicm.com / <strong>June</strong> <strong>2020</strong> / PAGE 23



Sean Feast speaks to Richard Webster about credit<br />

insurance, civil engineering, and Belisha Beacons.<br />

AUTHOR – Sean Feast FCICM<br />

RICHARD Webster is no stranger<br />

to credit insurance. The former<br />

Chief Executive of Euler Hermes<br />

in the UK and Ireland is now<br />

the Global Head of Trade <strong>Credit</strong><br />

(Distribution & Operations) for<br />

the US General Insurance giant AIG. But both<br />

roles are a far cry from what Richard initially<br />

set out to do, having studied civil engineering at<br />

Manchester University.<br />

“My first job on leaving university was with<br />

the International division of Taylor Woodrow<br />

and I spent three years in places like Saudi<br />

Arabia and Algeria whereas some of my<br />

contemporaries got to go to New Zealand or<br />

Trinidad! Both Saudi and Algeria are Islamic<br />

countries, and it was interesting to observe and<br />

respect a culture that was very much at odds<br />

with western secular views.<br />

“The benefit of being a westerner in these<br />

countries is that you accelerated up the company<br />

hierarchy must faster than if you stayed in the<br />

UK, and six months after leaving university I<br />

was already managing a team. This is probably<br />

what helped most in building my confidence<br />

from a comparatively young age. The downside<br />

was that there was little or no alcohol, and for a<br />

young man that was a challenge!”<br />


Qualifying as a Chartered Civil Engineer,<br />

Richard soon had a hankering for the business<br />

management side of life, and so self-funded a<br />

two-year, full-time MBA, returning to his Alma<br />

Mater in preference to London. On successfully<br />

completing his course, he applied for and<br />

secured a role at the Expamet Group as General<br />

Manager and subsequently Managing Director<br />

of Bergo, a manufacturer and installer of<br />

highway and road traffic equipment. “Overnight<br />

I became an expert in Belisha Beacons,” Richard<br />

jokes.<br />

His new appointment gave Richard the<br />

opportunity to focus on his passion for<br />

restructuring and change management, turning<br />

the theory he had studied for his MBA into<br />

practical action. It also provided the foundation<br />

for the next 30 years: “Every business I have been<br />

involved in since – whether finance, business<br />

services or manufacturing – has needed<br />

to go through change to improve business<br />

performance. It’s something that’s a challenge,<br />

and something I enjoy.”<br />

After Bergo and a spell in the electronic<br />

security industry with Westinghouse Electronics<br />

and Orbis, Richard dipped his toe in the first of<br />

three roles working for PE-backed businesses as<br />

“Every business<br />

I have been<br />

involved in<br />

since – whether<br />

finance, business<br />

services or<br />

manufacturing –<br />

has needed to go<br />

through change to<br />

improve business<br />

performance.<br />

It’s something<br />

that’s a challenge,<br />

and something I<br />

enjoy.”<br />

Managing Director of Brimar, part of the Image<br />

Precision International Group. “Brimar was an<br />

interesting business to work for as we made<br />

head-up displays and night vision technology<br />

that went into fast jets and attack helicopters.<br />

We had a sister company, Cintel, which was also<br />

a leader in its field turning film into electronic<br />

images but with the explosion of digital there<br />

was a ‘jump in the innovation curve’ as they call<br />

it, and its business was all-but wiped out.”<br />

Leaving Brimar, Richard spent an enjoyable<br />

three years at Amey Rail, rebuilding the<br />

company’s relationships with RailTrack and<br />

doubling the size of the business before being<br />

headhunted for a new career in insurance: “I<br />

told the headhunter that I knew nothing about<br />

insurance and even less about credit insurance,<br />

but he said that didn’t matter. What was<br />

important was my change management skills<br />

and that was what was needed.”<br />


It was the start of six years with the then Trade<br />

Indemnity as it transitioned into the Euler<br />

Hermes Group, becoming Euler Hermes UK<br />

during his tenure. By the time he left for his<br />

second stint with a PE-backed business, Richard<br />

had helped the UK and Irish business deliver<br />

record profits and had fully integrated it into<br />

the global group.<br />

His next move, perhaps with the benefit of<br />

hindsight, was a mistake, as Managing Director<br />

of Merlin a Loss Adjusting/Claims <strong>Management</strong><br />

business, and he did well to keep it viable for<br />

as long as he did given the parlous state of its<br />

finances compounded by the global economic<br />

disaster of 2008/2009. “We did manage to<br />

innovate,” Richard says, “sharing risk and<br />

reward on the settlement of claims which was an<br />

innovation and accelerating the claims process<br />

using desk based settlement, but the highly<br />

leveraged balance sheet and the economy were<br />

always against us.”<br />

At Morgan Sindall Richard returned to his<br />

construction and civil engineering roots, leading<br />

its Professional Services team (since rebranded<br />

as BakerHicks) to deliver a range of multidisciplinary<br />

skills to the construction industry.<br />

Two major contracts – Whitechapel Crossrail<br />

station in London and Novartis in Basel (the<br />

business had offices in the UK and Switzerland,<br />

the latter primarily dealing with pharmaceutical<br />

clients) – ensured a successful period in charge,<br />

with increased fees and profitability.<br />

Afterwards, he spent a little time as an<br />

M&A consultant for the PM Group (A Morgan<br />

Sindall JV partner) prior to joining PlayPower,<br />

Advancing the credit profession / www.cicm.com / <strong>June</strong> <strong>2020</strong> / PAGE 24

“Brimar was an interesting<br />

business to work for as we made<br />

head-up displays and night vision<br />

technology that went into fast jets<br />

and attack helicopters.’’<br />

Advancing the credit profession / www.cicm.com / <strong>June</strong> <strong>2020</strong> / PAGE 25 continues on page 26 >


AUTHOR – Sean Feast FCICM<br />

a manufacturer and installer of recreational equipment, as MD<br />

EMEA. It was another PE-backed business controlled out of the<br />

US, and whereas the market was interesting – selling children’s<br />

playground and outdoor fitness equipment mainly manufactured<br />

in Sweden – it was only a brief flirtation before he accepted the<br />

job at AIG.<br />


As Global Head of Trade <strong>Credit</strong> (D&O), Richard has responsibility<br />

for everything that falls into the area of distribution and<br />

operations: “The underwriting teams report to me globally, and<br />

I am also responsible for managing our distribution network<br />

(principally brokers),” Richard explains. “I live in Didsbury but<br />

have a flat in London so I can usually walk to our offices in<br />

Fenchurch Street when I am not travelling in the US, Europe or<br />

Asia Pac.”<br />

AIG differentiates its service from the three mainstream<br />

monoline players (Euler Hermes, Atradius and Coface) by<br />

focussing on large corporate customers and providing policies<br />

with non-cancellable limits and high discretionary limits. It<br />

doesn’t target the small business pond: “Euler Hermes and the<br />

others provide more of a credit management solution and do it<br />

very well, whereas we focus on corporate customers who already<br />

have sophisticated credit management skills and want the<br />

certainty of cover that our non-cancellable limits brings, and who<br />

want to insure their largest exposures (i.e those that are business<br />

critical) but are prepared to absorb the smaller claims as part of<br />

their deductible.”<br />

Richard estimates that the size of the credit insurance industry<br />

is anywhere between $10bn – $12bn including governmentbacked<br />

cover. Three quarters of the market is served by the<br />

three monolines, and AIG’s mission is to become the leading<br />

global General Insurance firm providing Trade <strong>Credit</strong> Insurance.<br />

As with everyone else in the industry, however, it’s a tough gig:<br />

“Everyone in trade credit is actually in competition with the same<br />

thing, and that’s self-insurance. A Financial Director is weighing<br />

up the cost of the premium against the cost of increasing his bad<br />

debt provision and the impact of a customer insolvency on his<br />

cashflow. What we have to do as a business and as an industry<br />

is demonstrate the value that we add in terms of insights and<br />

information, and the knowledge we have of other businesses in<br />

their industry or sector. That’s the challenge.”<br />


The current COVID-19 crisis is adding to the challenge, though<br />

Richard says that AIG’s business is holding up well: “We are<br />

doing what we can to support our customers,” he says. “Most<br />

insurers within the industry provide whole turnover cover with<br />

cancellable limits, but because we offer non-cancellable limits<br />

customers have the certainty that their terms are only reviewed at<br />

the point of renewal, and this enables them to plan.”<br />

Some areas, Richard says, will definitely need to be revisited:<br />

“Certain sectors like Airlines and Leisure are clearly being hit<br />

harder than most, but others, like Bricks and Mortar retail, were<br />

of concern long before the Coronavirus was even heard of. And the<br />

industry was already concerned about a potential economic down<br />

turn in <strong>2020</strong>/21, which had influenced underwriting appetite.”<br />

Although currently in lockdown, AIG is still progressing with<br />

plans to grow the business by recruiting new talent and investing<br />

in a new IT platform due for roll-out in 2021, so there is plenty to<br />

look forward to. At the time of writing, Richard, too, is currently<br />

at home in the northwest, competing virtually with thousands of<br />

others on his Peloton bike and generally missing rugby which is<br />

another passion: “I played 1st XV Rugby at university and am a<br />

rugby referee,” he says, “but today I am having to content myself<br />

with a Day Skipper course that I’m studying online!”<br />

“Certain sectors like<br />

Airlines and Leisure are<br />

clearly being hit harder<br />

than most, but others, like<br />

Bricks and Mortar retail,<br />

were of concern long before<br />

the Coronavirus was even<br />

heard of. And the industry<br />

was already concerned<br />

about a potential economic<br />

down turn in <strong>2020</strong>/21,<br />

which had influenced<br />

underwriting appetite.”<br />

Advancing the credit profession / www.cicm.com / <strong>June</strong> <strong>2020</strong> / PAGE 26

Level 4 Apprenticeship<br />

Counter Fraud<br />

Investigator<br />

Certificate in<br />

Consumer Debt Collection<br />

(CertDC)<br />

in partnership with<br />

The London Institute of Banking and Finance<br />

<strong>Credit</strong> Services Association (CSA)<br />

Apprenticeship Programme Overview<br />

<strong>Credit</strong> Services Association (CSA)<br />

Programme Overview<br />

Advancing the credit profession / www.cicm.com / <strong>June</strong> <strong>2020</strong> / PAGE 27


How to ensure steady<br />

cash flow during<br />

economic uncertainty<br />

A HighRadius Perspective.<br />

KEEPING your business<br />

afloat in a global<br />

economic storm requires<br />

a careful balance of<br />

customer empathy and<br />

operational rigour.<br />

Finance and Accounts Receivable<br />

teams are being very specific in terms<br />

of analysing and adapting customer<br />

credit whilst putting increased efforts<br />

into collecting cash as fast as possible.<br />

Using tools that deliver help to<br />

enable prioritisation and can provide<br />

the lifejacket to maintain commercial<br />

buoyancy.<br />

There is however a tendency to<br />

place the strides made towards digital<br />

transformation on hold and pivot existing<br />

processes to ‘just get through’. In a<br />

recent panel discussion conducted by<br />

HighRadius, Laurent Guarantine, GPO -<br />

Customer Invoicing to Cash from Sanofi,<br />

pointed out the following as mitigation<br />

actions:<br />

• Increased customer calls and proactive<br />

actions<br />

• Soft tone approach<br />

• Change in payment method, moving to<br />

wire transfers instead of cheques for an<br />

instance.<br />

Michael Flum, COO & SVP,<br />

<strong>Credit</strong>RiskMonitor said: “People<br />

are moving towards a dollars at risk<br />

methodology rather than looking at the<br />

relative risk at a company-level.”<br />

We agree. Cash is king, but we believe<br />

organisations should look to how they can<br />

continually analyse, anticipate and flex<br />

receivables processes to maintain a steady<br />

commercial course whatever the playing<br />

conditions. However, our perspective<br />

is that COVID-19 is acting almost like a<br />

stress management test which is likely to<br />

expose gaps in processes and systems that<br />

will need attention in order to navigate<br />

through a similar situation in the future.<br />

HighRadius has always forged an<br />

innovative path for Accounts Receivable<br />

with the implementation of AI and<br />

digital assistant Freeda. While improving<br />

the cash flow is the major focus area,<br />

HighRadius helps its customers to reduce<br />

DSO and bad debt through proactive credit<br />

and collections. In the current climate<br />

intelligent, easily accessible solutions<br />

could make a significant difference<br />

in how you weather these turbulent<br />

economic conditions. Here's how:<br />

It won't be the last<br />

time we have to<br />

navigate through<br />

choppy economic<br />

waters and<br />

maintaining a good<br />

cash position and<br />

company viability<br />

is likely to remain a<br />

top priority for the<br />

foreseeable future.<br />

1. Upgrade your credit risk<br />

strategies across various business<br />

units<br />

Every organisation will be re-evaluating<br />

their credit policies. However, what gets<br />

discussed in the boardroom, doesn’t<br />

always get translated into day-to-day<br />

credit operations. HighRadius gives you<br />

the tools to translate your rapidly evolving<br />

credit policy into credit scoring models.<br />

These combine your choice of external<br />

credit and public financials data so that<br />

every credit analyst on your team makes<br />

risk decisions aligned with your company<br />

strategy.<br />

2. Utilise real-time data direct from<br />

credit agencies and bureaus to fuel<br />

the effectiveness of an increased<br />

number of periodic reviews<br />

Unpredictability will mean organisations<br />

may have to make modifications in the<br />

risk strategy. As a credit professional, it<br />

is important to stay ahead of those risks<br />

with more frequent periodic reviews<br />

and regular updates in credit scoring.<br />

HighRadius’ dynamic credit scoring<br />

model pulls in real-time data from<br />

credit agencies, bureaus such as D&B,<br />

Experian, Equifax and provides realtime<br />

bankruptcy and risk alerts. AI and<br />

machine learning help to predict the<br />

upcoming blocked orders enabling credit<br />

teams to not only collect faster but also<br />

stay updated with unexpected risk alerts.<br />

3. Prioritise which customer to<br />

reach out to for recovering pastdues<br />

<strong>Credit</strong> and collections are very sensitive<br />

operations at this moment and collection<br />

analysts need to handle accounts<br />

carefully. Many organisations generate 80<br />

percent of their revenue from 20 percent<br />

of their accounts and particular care will<br />

be paid to these strategic customers. With<br />

an AI-enabled prioritised worklist, the<br />

collectors will be able to get a 360 degree<br />

view of which customers they need to<br />

contact first. They will be able to spend<br />

more time figuring out what should be<br />

the dunning strategy for each customer,<br />

instead of figuring out whom to contact<br />

every day.<br />

4. Predict customer payment dates<br />

Reducing DSO will be ever more<br />

challenging as A/P teams are delaying<br />

their payments further to have more<br />

available cash in their hands. What if<br />

the credit and collections department is<br />

already aware of the next possible date<br />

when the customer is going to make the<br />

payment? HighRadius has enabled AI in<br />

collections management to predict the<br />

customer payment date, based on which<br />

the collections team can formulate their<br />

strategies beforehand to increase the<br />

dunning efficiency.<br />

It won't be the last time we have to<br />

navigate through choppy economic waters<br />

and maintaining a good cash position<br />

and company viability is likely to remain a<br />

top priority for the foreseeable future. At<br />

HighRadius we continue to partner with<br />

some of the leading companies in their<br />

field to help them deliver against their top<br />

accounts receivable KPI’s as they flex their<br />

operations during this uncertain time.<br />

Advancing the credit profession / www.cicm.com / <strong>June</strong> <strong>2020</strong> / PAGE 28


‘Ferrero Reduced DSO from 57 days<br />

to 25 days with 40% Improvement in<br />

Collector’s Productivity.’<br />

40%<br />

About HighRadius<br />

HighRadius is a Fintech enterprise Softwareas-a-Service<br />

(SaaS) company which leverages<br />

Autonomous Receivables to help companies put<br />

their order to cash on autopilot. The HighRadius®<br />

Integrated Receivables platform reduces cycle times<br />

in your order-to-cash process through automation of<br />

receivables and payments processes across credit,<br />

electronic billing and payment processing, cash<br />

application, deductions and collections. Powered<br />

by the RivanaTM Artificial Intelligence Engine and<br />

FreedaTM Virtual Assistant for order-to-cash teams,<br />

HighRadius enables teams to leverage machine<br />

learning to predict future outcomes and automate<br />

routine labour-intensive tasks. The radiusOneTM<br />

B2B payment network allows suppliers to digitally<br />

connect with buyers, closing the loop from supplier<br />

receivable processes to buyer payable processes.<br />

HighRadius solutions have a proven track record<br />

of optimizing cash flow, reducing days sales<br />

outstanding (DSO) and bad debt, and increasing<br />

operational efficiency so that companies may<br />

achieve strong ROI in just a few months. To learn<br />

more, please visit www.highradius.com.<br />

‘Yaskawa Achieved 5.5<br />

Days Reduction in DSO<br />

with Zero Bad Debt’<br />

5.5<br />

Days Reduction<br />

HighRadius has always forged<br />

an innovative path for Accounts<br />

Receivable with the implementation<br />

of AI and digital assistant Freeda.<br />

Advancing the credit profession / www.cicm.com / <strong>June</strong> <strong>2020</strong> / PAGE 29


TRADE<br />


INFLATION is the enemy of any modern<br />

economy. Or is it? With all of the largesse<br />

of governmental spending, it appears that<br />

to keep economies alive, governments are<br />

going to aim for a higher than ideal level<br />

of inflation to help cover the cost of all<br />

the money that they’ve magically ‘printed’<br />

at the press of a button. Why? Inflation<br />

diminishes the impact of debt. For example,<br />

the average house in January 1990 cost,<br />

according to the Land Registry, £58,250,<br />

a figure that grew to £190,665 by January<br />

2015. Indeed, data from the ONS showed<br />

that median gross income in 1990 was<br />

£13,789, but by 2015, had risen to £31,699,<br />

thus making a mortgage over 25 years<br />

much more affordable over time.<br />

What does this all mean? Make sure<br />

contracts allow for price reviews to ensure<br />

that inflation doesn’t eat away at your<br />

export revenue.<br />

Monthly round-up of the latest stories<br />

in global trade by Andrea Kirkby.<br />

Global manufacturers<br />

are looking at their tools<br />

WHEN people are locked down,<br />

generally unable to leave their<br />

homes, it appears that with<br />

time on their hands, they tend to do<br />

what is fun. And so, as reports would<br />

have it, sex toy sales are taking off in<br />

Colombia. In a normally conservative<br />

country, adult products are flying off<br />

the shelves – a trend that started on<br />

just day four of a five-week lockdown.<br />

With quotes used by Reuters of ‘we’ve<br />

seen a rise of 50 percent (in sales)’, and<br />

‘a swell in sales’ and ‘stiff competition’,<br />

it appears that it’s a market ripe for<br />

picking by those that are interested<br />

and able. But the growth in sex toy<br />

sales is not limited to Colombia. It<br />

appears that growth in this market<br />

in Denmark has more than doubled,<br />

while Ann Summers, here in the UK,<br />

has said that its sales were up 27<br />

percent in the last week of March.<br />

And the key to selling into this market<br />

is to tap into the world of online.<br />

The report quoted psychologist Dr<br />

Carolina Guzman who explains that “…<br />

Colombia has a very conservative idea<br />

around sexuality and communication<br />

surrounding it.” She added: “It’s a good<br />

time for people to allow themselves<br />

to work on their curiosity and to<br />

understand that buying and using<br />

these products is a great thing.”<br />

Without delving too much into the<br />

products themselves, products with<br />

mobile phone applications that allow<br />

separated partners to control toys for<br />

one another are particularly popular.<br />

So, if Burberry can retool for the NHS,<br />

maybe UK manufacturers should see<br />

if they could do the same for the adult<br />

sector?<br />

ANYONE watching the global market<br />

for oil will know that the sector is in<br />

trouble. Saudi Arabia is in particular<br />

distress as its economy – according<br />

to the Economist, has been frozen<br />

because of the Coronavirus outbreak<br />

which has left it with ‘lakes of<br />

unwanted oil’. Apparently, the country<br />

needs oil to be above $85/barrel to<br />

balance its budget. The market is<br />

paying close to $20/barrel and in some<br />


instances paid buyers to take oil away.<br />

The drop in the price of oil has left<br />

Saudi Arabia with a $2bn weekly hole<br />

in its accounts and it has been forced<br />

to slash public expenditure by 50bn<br />

riyals (£10.6bn). To make matters worse,<br />

despite the push for diversification,<br />

oil provides about two-thirds of<br />

government revenue and brought in<br />

about $208bn, a figure that could drop<br />

by more than $100bn this year. And on<br />

top of that, budget cuts hurt two-thirds<br />

of the nation’s workforce as they are<br />

employed by the state.<br />

But despite Saudi woes, Russia has<br />

not come out smelling of roses either.<br />

It refused to cut output in March in<br />

an attempt undercut the US fracking<br />

industry. However, it now finds itself in<br />

a situation of having to agree to 2.5m<br />

barrels per day in cuts, four times more<br />

than it refused to sign up to in March.<br />

Advancing the credit profession / www.cicm.com / <strong>June</strong> <strong>2020</strong> / PAGE 30

Ukraine, a land ready for sowing?<br />

IN need of monies, Ukraine’s<br />

parliamentarians voted to allow the sale<br />

of farmland in order to access an $8bn<br />

loan package from the International<br />

Monetary Fund (IMF). The ban had been<br />

in place for almost 20 years and the comic<br />

turned president, Volodymyr Zelenskiy,<br />

pushed for the lifting of the ban. Now<br />

this is good news – for two reasons. The<br />

funding takes away the risk of default<br />

as the country deals with the economic<br />

shock caused by the pandemic that has<br />

caught so many on the hop. Also, the<br />

opening up of Ukraine’s land market helps<br />

unlock the investment potential in what is<br />

one of the world’s top grain exporters – a<br />

move that most certainly will help any<br />

savvy exporting manufacturer of farming<br />

plant and equipment. But there’s no rush<br />

to market yet; the new legislation doesn’t<br />

take effect until July 2021. Be careful how<br />

you sell mind you, the fact that Ukraine<br />

needs IMF assistance isn’t great news<br />

– a point emphasised by the Ukrainian<br />

government which expects the economy<br />

to shrink by 3.9 percent in <strong>2020</strong>.<br />

3 to watch as the world reconfigures<br />

STOCK markets are an imperfect indicator<br />

of corporate performance. With occasional<br />

instances of insider trading and market<br />

manipulations, share data should be used<br />

in conjunction with other sources. That<br />

said, common-sense when combined<br />

with tips can shine a light on export<br />

opportunities. And some UK firms are<br />

doing well around the world. Consider<br />

a tip from the Sunday Telegraph on the<br />

diversified miner Anglo American. It<br />

believes that the virus lockdown will be<br />

followed by a rapid return to work and<br />

rising demand making mining a natural<br />

target for any exporter serving the sector.<br />

Then there’s Anpario, which was<br />

tipped by the Mail on Sunday. Anpario is<br />

a small firm that makes natural, healthy<br />

additives for animal feed – a key product<br />

for keeping the world fed. It’s been chasing<br />

sales in Latin America, parts of Asia and<br />

the Middle East and has done well. With<br />

no debt and £13m in cash in the bank<br />

it’s done rather well with more latitude<br />

for growth as concerns over animal feed<br />

quality and its effects on humans grows.<br />

Apart from being a success story it makes<br />

the point that export isn’t just about price,<br />

it’s about quality too.<br />

And then there’s Cranswick, a UK food<br />

producer that Shares Magazine says<br />

is benefitting from both consumers in<br />

lockdown buying ‘treat’ food to consume<br />

at home and also, a shortage of meat in<br />

China after African swine fever opened up<br />

new export opportunities as the Chinese<br />

sought to buy product that was perceptibly<br />

safer.<br />



CREDIT insurer Coface, in its latest<br />

business barometer, thinks that the we’re<br />

all heading towards a sudden global surge<br />

in business insolvencies. What started<br />

as an epidemic in China which affected<br />

a limited number of supply chains has<br />

since turned into a global pandemic with<br />

repercussions that have created a double<br />

shock – supply and demand – that is<br />

affecting industries all over the world.<br />

Coface reckons that the uniqueness<br />

of this crisis makes comparisons with<br />

the previous ones useless as they all had<br />

financial origins – the global credit crisis<br />

of 2008-09 and the great depression of<br />

1929 prove the point. It thinks that the<br />

question is no longer which countries<br />

and sectors of activity will be affected by<br />

the Coronavirus shock, but rather which<br />

(few) will be spared. Further, Coface thinks<br />

that the shock could be even more violent<br />

in emerging economies: in addition to<br />

managing the pandemic, which will be<br />

more difficult for them, they are also<br />

facing the fall in oil prices.<br />

To summarise its rather gloomy<br />

forecast, Coface is predicting a global<br />

growth rate of -1.3 percent (after +2.5<br />

percent in 2019), recessions in 68<br />

countries (compared to only 11 last year),<br />

world trade falling by 4.3 percent and a 25<br />

percent worldwide increase in business<br />

failures compared to a January forecast of<br />

just two percent.<br />

The most obvious consequence of<br />

Coronavirus in the short term is the<br />

exacerbation of existing geopolitical<br />

tensions and a new wave of Trumpian<br />

protectionist measures. Oh - will someone<br />

please start to talk about Brexit again?<br />

Watch out for your US and<br />

Brazilian business<br />

TAKING a line from Donald Trump,<br />

Brazil’s president, Jair Bolsonaro,<br />

continues to dismiss the risk of<br />

the pandemic. Bolsonaro wants the<br />

population to go back to work despite<br />

the isolation advocated by his own<br />

health minister. The president has told<br />

Brazilians that the risk from Coronavirus<br />

is low and the country should stay open<br />

for business. Does he have a point?<br />

Probably not – the country has infections<br />

which as of 20 April ballooned to nearly<br />

40,000 and more than 2500 deaths have<br />

followed. All things are relative from his<br />

perspective as the US has (by 20 April)<br />

recorded nearly 760,000 cases and 40,600<br />

deaths.<br />

Either way, take steps to ensure that<br />

your market exposure is covered and that<br />

your contacts are still around to talk to.<br />

Coronavirus won’t destroy mankind (yet),<br />

but it will make business inconvenient;<br />

those countries that do little to neutralise<br />

the infection risk could be walking<br />

toward severe economic turbulence.<br />

As an aside, to see how the infection<br />

is playing out around the globe (based<br />

on reported data), take a look at data<br />

from Center for Systems Science and<br />

Engineering at Johns Hopkins University<br />

at https://bit.ly/34SmAl3. It appears that<br />

while the US, Spain and Italy occupy the<br />

top slots for the number of Coronavirus<br />

incidents, the safest place to be (bearing<br />

in mind their healthcare structures) are<br />

Bhutan with five cases (one death), South<br />

Sudan with four cases and Yemen with<br />

just one case.<br />



OR CALL 020 7738 0777<br />

Currency UK is authorised and regulated<br />

by the Financial Conduct Authority (FCA).<br />


GBP/EUR 1.15292 1.11639 Down<br />

GBP/USD 1.26090 1.20763 Down<br />

GBP/CHF 1.21944 1.17353 Down<br />

GBP/AUD 1.97056 1.86619 Down<br />

GBP/CAD 1.78266 1.69993 Down<br />

GBP/JPY 135.15171 129.33969<br />

Down<br />

Advancing the credit profession / www.cicm.com / <strong>June</strong> <strong>2020</strong> / PAGE 31<br />

This data was taken on 20th May and refers to the month<br />

previous to/leading up to 19th May <strong>2020</strong>.




Marco Forgione believes the world is our oyster<br />

when it comes to international trade.<br />

AUTHOR – Sean Feast FCICM<br />

HAVING led the antiques<br />

industry trade body<br />

BADA for four years,<br />

coaxing its traditionalist<br />

membership into the<br />

digital age, Marco<br />

Forgione’s early months in his latest<br />

role have proved no less challenging.<br />

Taking the helm of the Institute of<br />

Export & International Trade (IOE&IT) in<br />

January, Marco’s task includes steering<br />

the organisation’s 3000-plus members<br />

towards life outside the EU. Covid-19,<br />

however, is reshaping global trade. <strong>Credit</strong><br />

<strong>Management</strong> asks the questions:<br />



Yes, in a word! Despite the disruption<br />

caused by Coronavirus, I firmly believe<br />

the UK’s trading horizons are opening up<br />

and that the world really is our oyster.<br />

With the end of the transition from the EU<br />

looming, this is an incredible time to be<br />

involved in international trade, with the<br />

UK pursuing its own independent trade<br />

future. What has been really heartening<br />

is how international trade supply chains,<br />

despite being severely tested during<br />

the Covid-19 pandemic, have met that<br />

challenge and delivered.<br />



IOE&IT, more so than ever, has a central<br />

role to play in upskilling and training<br />

UK business, supporting government<br />

and reaching out to other nations to<br />

develop their trading capacities. We’ve<br />

focussed our activity on three key areas:<br />

setting up a Covid-19 information hub;<br />

moving our education and training<br />

programmes online; and introducing<br />

a suite of enhanced services such as<br />

online Masterclasses and a new business<br />

services helpdesk, giving support in<br />

areas like tax and HR. We’ve also<br />

provided regular input to Government<br />

on how international trade is being<br />

affected, and suggesting ways policies can<br />

be adapted.<br />


Businesses involved in overseas trade<br />

need to be agile in their approach and<br />

planning. The ‘big picture’ lesson from<br />

this crisis is that company supply chains<br />

are too reliant on single suppliers and<br />

countries, particularly China. Our advice<br />

is to look through whole supply strategies<br />

and ensure there is the capacity, skills<br />

and knowledge needed to switch between<br />

supply routes, providers and nations.<br />

Businesses should<br />

ensure they have<br />

capacity across<br />

multiple territories<br />

within their supply<br />

chains, so that they are<br />

not vulnerable to an<br />

unexpected incident like<br />

Coronavirus.<br />




We must accept that the government will,<br />

despite COVID-19, stick to the deadline of<br />

31 December for the end of the transition<br />

period. After that date, the EU will be an<br />

international market for UK businesses,<br />

covered by international customs<br />

requirements. As a group of markets,<br />

Europe will remain our largest trading<br />

partner. For at least three generations, two<br />

thirds of UK exporters have been engaged<br />

in frictionless trade with Europe. As of<br />

1 January 2021, there will undoubtedly<br />

be friction. There will be customs<br />

declarations, the potential for tariffs, and<br />

rules and regulations to be complied with.<br />

The Institute’s role is to guide members<br />

to ensure they can continue trading as<br />

effectively and compliantly as possible,<br />

allowing them to continue to grow in<br />

European markets.<br />

We believe that many companies would<br />

benefit from the range of customs<br />

special schemes. Under these protocols,<br />

companies can reduce the bureaucracy<br />

and make goods passing through ports<br />

friction-free. So we’ve set up a specific<br />

online surgery service to help business<br />

implement these schemes. With the<br />

surgery, we review a firm’s existing<br />

processes, report back on where they<br />

need to improve, and signpost any<br />

training and education needed, as well as<br />

the appropriate systems, processes and<br />

protocols required to trade effectively<br />

going forward.<br />



<strong>Credit</strong> management and credit insurance<br />

are certainly big issues, and our training<br />

and qualifications reflect this, especially<br />

in our learning module titled ‘Financing<br />

of International Trade’. Covid-19 is<br />

impacting all of us and in these uncertain<br />

times, exporters may have greater<br />

uncertainty around a buyer’s or country’s<br />

ability to pay. The Institute has lobbied<br />

government to support exporting and<br />

importing businesses in all aspects of<br />

how they trade. So, we’re really pleased<br />

the government has recently agreed<br />

to temporarily guarantee trade credit<br />

insurance for businesses struggling to<br />

get cover due to Coronavirus. We are<br />

also pleased that UK Export Finance now<br />

supports credit insurance for exports to<br />

high-performing OECD markets, whereas<br />

before it was only available for exports to<br />

non-OECD markets.<br />




There is already a wide range of<br />

support available from government,<br />

including those projects on which we’ve<br />

partnered, such as the UK Customs<br />

Academy and Open to Export. Overall,<br />

to ease businesses into the post-Brexit<br />

world, and to reshape the UK into a<br />

high-tech, high-skill economy, the<br />

Advancing the credit profession / www.cicm.com / <strong>June</strong> <strong>2020</strong> / PAGE 32


AUTHOR – Sean Feast FCICM<br />

IOE&IT wish list for<br />

government during<br />

COVID-19 and beyond<br />

• Fast-track the digitising of trade<br />

documentation (some rules date<br />

from the 18th century).<br />

• Extend the government’s grant<br />

for international trade training to<br />

individuals and beyond January<br />

2021.<br />

• Support the commercial trade<br />

credit insurance market.<br />

• Review the job retention scheme<br />

to learn from Germany’s Kurzarbeit<br />

system, which allows people to<br />

move in and out of furlough.<br />

• Review business taxes, including<br />

reduced corporation tax on exportrelated<br />

profits.<br />

government is using a carrot-and-stick<br />

approach. The carrot is the generous<br />

government grants for training in how<br />

to trade internationally, a fund we’ve<br />

argued should continue beyond January<br />

2021 and access extended to individuals<br />

as well as companies. The stick is to<br />

cut off the supply of cheap labour<br />

to the UK through the government’s<br />

new immigration policies. So, there is<br />

no other option. We have to invest in a highskill<br />

workforce, which includes building<br />

expertise in exporting and importing.<br />




To pursue a view which is contrary to<br />

government policy will not benefit anyone.<br />

There will be trade friction whether we<br />

have an agreement or not, and there is still<br />

a possibility we will be operating without<br />

a deal and on WTO terms after January<br />

2021. The impact of Covid-19 could provide<br />

an incentive for all sides to want to make<br />

a deal as there will be little appetite for<br />

further economic damage.<br />



For our part, the IOE&IT has consistently<br />

put members’ concerns and desires to<br />

government, and we’re getting a positive<br />

response. For instance, we’ve been arguing<br />

for VAT and duty easements during the<br />

COVID-19 crisis and the government has<br />

listened. Measures adopted so far include<br />

the waiving of VAT on imports of PPE,<br />

digitising export-related documents and<br />

the easing of red tape around several key<br />

customs procedures. Early in May, I took<br />

part in a virtual face-to-face meeting with<br />

small business minister Paul Scully MP,<br />

alongside four other trade body leaders.<br />

The conversation was extremely positive:<br />

the minister showed that government<br />

understands the challenges that UK<br />

businesses trading overseas face.<br />



CRISIS?<br />

I’ll give you one international example<br />

we’re already working on. We’re<br />

working with the International Trade<br />

Centre to deliver a pilot project, funded<br />

by the WTO and UN, building trade<br />

capacity in Ghana. This follows the success<br />

of our work in Saudi Arabia last year. The<br />

idea is to roll out this project throughout<br />

Africa and the Middle East. This work is<br />

important because not only does it upskill<br />

trade capacity in developing * nations,<br />

but it also establishes UK processes and<br />

approaches in these growing markets.<br />


NOW?<br />

Overall, the source of cheer is that for the<br />

first time in three generations, the UK<br />

is free to introduce a low tariff, liberal,<br />

globally focussed, free-trade environment.<br />

We’ve seen from the Budget in March and<br />

the COVID-19 support packages the priority<br />

this government is putting on helping<br />

SMEs and the role of export in powering<br />

the UK economy.<br />

The government is clear that it will do<br />

a deal with any country seeking a trade<br />

agreement – so long as it meets the UK’s<br />

strategic aims. We can see with the terms of<br />

the negotiations with the US and Japan that<br />

the UK government is seeking to establish<br />

broad based platforms of agreement.<br />

Coronavirus is a huge challenge, but<br />

there is an opportunity for manufacturing<br />

to be ‘re-homed’. Businesses should<br />

ensure they have capacity across multiple<br />

territories within their supply chains,<br />

so that they are not vulnerable to an<br />

unexpected incident like Coronavirus.<br />

Historically there has been a lack of<br />

adequate signposting to the help that’s<br />

available. My role is to engage more<br />

effectively with government to ensure that<br />

support continues and that the Institute<br />

plays an increasingly stronger role in<br />

providing it.<br />

Courtesy Institute of<br />

Export/by Earl Smith<br />

Advancing the credit profession / www.cicm.com / <strong>June</strong> <strong>2020</strong> / PAGE 33



The UK’s Automotive Industry faces a difficult future.<br />

AUTHOR – Tim Vine<br />

THE UK has a long affinity with<br />

the automotive industry, dating<br />

all the way back to the late<br />

1800’s. As the UK and Europe was<br />

on the precipice of the second<br />

industrial revolution, we began<br />

making the transition from horse and cart to<br />

engines powered by gasoline, and over the<br />

course of the 20th century, automobiles became<br />

the default mode of transportation.<br />

Fast forward to today, and the automotive<br />

industry makes up a fundamental share of the<br />

UK’s economy, worth over £82bn in turn over,<br />

and adding a significant £18.6bn to the UK<br />

economy. Recognisable brands synonymous<br />

with British car manufacturing include Rolls<br />

Royce, Bentley, Mini, and Aston Martin.<br />

The UK automotive industry employs around<br />

168,000 people in manufacturing plants across<br />

the country and in excess of 823,000 across the<br />

wider automotive industry. Last year, over 1.3<br />

million cars, 78,270 commercial vehicles and<br />

2.5 million engines were manufactured in the<br />

UK. And for every ten cars produced, eight of<br />

those are exported to 160 markets globally.<br />

We don’t yet know what the impact of<br />

coronavirus will be on the industry with some<br />

suggesting that demand for cars will actually<br />

increase in response to limited international air<br />

travel and other social distancing restrictions on<br />

public transport. However, recent IHS Markit<br />

predictions forecast a 24.6 percent reduction in<br />

European auto sales in Europe in <strong>2020</strong>.<br />

And while the UK automotive industry is a<br />

power engine in itself for the UK economy, it’s<br />

not always an easy path. Increasing regulations<br />

and government targets have put pressure<br />

on the industry to innovate and adapt, as the<br />

industry is undergoing one of the biggest shifts<br />

in its history.<br />


The automotive industry’s significant<br />

contribution to the UK economy is likely to be<br />

impacted by environmental requirements to<br />

reduce CO2 emissions that will inevitably and<br />

irrevocably change the landscape. In a bid<br />

to tackle emissions, the UK has set itself the<br />

bold target of decarbonising all vehicles in the<br />

country by 2050 and have proposed a complete<br />

ban on the sale of new petrol and diesel cars<br />

by 2035. As a result, we are seeing much more<br />

focus on electric vehicles to serve as a greener<br />

alternative to gasoline fuelled cars.<br />

While electric vehicles have been<br />

around since the beginning in the 1880s, as<br />

experimental cars ran on steam, gasoline, or<br />

electricity, it is only over the past decade that<br />

electric vehicles have advanced enough to offer<br />

a suitable alternative to petrol or diesel vehicles.<br />

Although still in its infancy with mass<br />

consumer adoption and share of the new car<br />

market, figures for electric cars are steadily<br />

on the rise and as of last year, electric vehicles<br />

made up 7.3 pecent of newly registered cars<br />

in the UK and as government deadlines draw<br />

closer, this figure is expected to rise in parallel.<br />

Although the UK’s automotive industry has<br />

come up against new challenging targets and<br />

pending regulations, our analysis suggests that<br />

business performance has shown positive signs<br />

over recent years.<br />

Dun & Bradstreet’s data indicates that<br />

payment performance for the UK’s automotive<br />

industry has steadily improved from 13.3<br />

percent of bills paid on time in March 2017 to 22<br />

percent in March <strong>2020</strong>*.<br />

The number of businesses involved in the<br />

manufacture of motor vehicles industry has<br />

increased over the last three years, from over<br />

1,000 in 2017 to over 1,400 in <strong>2020</strong>, which albeit<br />

a positive trend may change in the wake of<br />

coronavirus.<br />


With the global economy going through one<br />

of the most unprecedented challenges ever<br />

known, this will undoubtedly affect the UK<br />

automotive industry alongside many others<br />

in the months and quarters to come. With<br />

communities in lockdown and whole industries<br />

and supply chains coming to a halt, the working<br />

world as we know it changed overnight, and<br />

the UK automotive industry has not gone<br />

unaffected.<br />

All of the UK’s car manufacturingfactories<br />

shutdown as the UK complied with the stringent<br />

restrictions from the government, designed to<br />

overcome the pandemic.<br />

Moreover, the Society of Motor Manufacturers<br />

and Traders (SMMT) has cautioned that the<br />

coronavirus outbreak could result the in UK<br />

producing 200,000 fewer cars in <strong>2020</strong>, which<br />

would be an 18 percent reduction on last year’s<br />

total output. And these figures are set to further<br />

increase if the UK’s lockdown continues to go<br />

into months as opposed to weeks.<br />

The full economic impact of coronavirus<br />

on both the automotive industry and UK’s<br />

economy is yet to be determined. What is clear<br />

though, is that the automotive industry will not<br />

be alone in finding its way back, as the country<br />

faces the likelihood of another recession and<br />

the road to recovery for the industry is set to be<br />

an uncertain one.<br />

Tim Vine is European Head of Finance & Risk<br />

Solutions, Dun & Bradstreet<br />

Although the UK’s<br />

automotive industry<br />

has come up against<br />

new challenging<br />

targets and pending<br />

regulations, our<br />

analysis suggests<br />

that business<br />

performance has<br />

shown positive signs<br />

over recent years.<br />

Advancing the credit profession / www.cicm.com / <strong>June</strong> <strong>2020</strong> / PAGE 34


AUTHOR – Tim Vine<br />

*Please note this data is reflective<br />

of before the COVID-19 outbreak and<br />

is based on analysis of available<br />

trade payment data<br />

With communities in lockdown<br />

and whole industries and supply<br />

chains coming to a halt, the<br />

working world as we know it<br />

changed overnight, and the UK<br />

automotive industry has not<br />

gone unaffected.<br />

Advancing the credit profession / www.cicm.com / <strong>June</strong> <strong>2020</strong> / PAGE 35



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Bottomline Technologies (NASDAQ: EPAY) helps<br />

businesses pay and get paid. Businesses and banks<br />

rely on Bottomline for domestic and international<br />

payments, effective cash management tools, automated<br />

workflows for payment processing and bill review<br />

and state of the art fraud detection, behavioural<br />

analytics and regulatory compliance. Every day, we<br />

help our customers by making complex business<br />

payments simple, secure and seamless.<br />

Chris Sanders Consulting (Sanders Consulting<br />

Associates) has three areas of activity providing<br />

credit management leadership and performance<br />

improvement, international working capital<br />

improvement consulting assignments and<br />

managing the CICMQ Best Practice Accreditation<br />

programme on behalf of the CICM. Plans for<br />

2019 include international client assignments in<br />

India, China, USA, Middle East and the ongoing<br />

development of the CICMQ Programme.<br />

Key IVR provide a suite of products to assist companies<br />

across Europe with credit management. The<br />

service gives the end-user the means to make a<br />

payment when and how they choose. Key IVR also<br />

provides a state-of-the-art outbound platform delivering<br />

automated messages by voice and SMS. In a<br />

credit management environment, these services are<br />

used to cost-effectively contact debtors and connect<br />

them back into a contact centre or automated<br />

payment line.<br />

T: 0870 081 8250<br />

E: emea-info@bottomline.com<br />

W: www.bottomline.com/uk<br />

T: +44(0)7747 761641<br />

E: chris@chrissandersconsulting.com<br />

W: www.chrissandersconsulting.com<br />

T: +44 (0) 1302 513 000<br />

E: sales@keyivr<br />

W: www.keyivr.co.uk<br />

With 130+ years of experience, Graydon is a leading<br />

provider of business information, analytics, insights<br />

and solutions. Graydon helps its customers to make<br />

fast, accurate decisions, enabling them to minimise<br />

risk and identify fraud as well as optimise opportunities<br />

with their commercial relationships. Graydon<br />

uses 130+ international databases and the information<br />

of 90+ million companies. Graydon has offices in<br />

London, Cardiff, Amsterdam and Antwerp. Since 2016,<br />

Graydon has been part of Atradius, one of the world’s<br />

largest credit insurance companies.<br />

T: +44 (0)208 515 1400<br />

E: customerservices@graydon.co.uk<br />

W: www.graydon.co.uk<br />

Operating across seven UK offices, Menzies LLP is<br />

an accountancy firm delivering traditional services<br />

combined with strategic commercial thinking. Our<br />

services include: advisory, audit, corporate and<br />

personal tax, corporate finance, forensic accounting,<br />

outsourcing, wealth management and business<br />

recovery – the latter of which includes our specialist<br />

offering developed specifically for creditors. For<br />

more information on this, or to see how the Menzies<br />

<strong>Credit</strong>or Services team can assist you, please<br />

visit: www.menzies.co.uk/creditor-services.<br />

T: +44 (0)2073 875 868 - London<br />

T: +44 (0)2920 495 444 - Cardiff<br />

W: menzies.co.uk/creditor-services<br />

Building on our mature and hugely successful<br />

product and world class support service, we are<br />

re-imagining our risk awareness module in 2019 to<br />

allow for hugely flexible automated worklists and<br />

advanced visibility of areas of risk. Alongside full<br />

integration with all credit scoring agencies (e.g.<br />

<strong>Credit</strong>safe), this makes Credica a single port-of-call<br />

for analysis and automation. Impressive results<br />

and ROI are inevitable for our customers that also<br />

have an active input into our product development<br />

and evolution.<br />

T: 01235 856400<br />

E: info@credica.co.uk<br />

W: www.credica.co.uk<br />

Advancing the credit profession / www.cicm.com / <strong>June</strong> <strong>2020</strong> / PAGE 36

Each of our Corporate Partners is carefully selected for<br />

their commitment to the profession, best practice in the<br />

<strong>Credit</strong> Industry and the quality of services they provide.<br />

We are delighted to showcase them here.<br />


Hays <strong>Credit</strong> <strong>Management</strong> is a national specialist<br />

division dedicated exclusively to the recruitment of<br />

credit management and receivables professionals,<br />

at all levels, in the public and private sectors. As<br />

the CICM’s only Premium Corporate Partner, we<br />

are best placed to help all clients’ and candidates’<br />

recruitment needs as well providing guidance on<br />

CV writing, career advice, salary bench-marking,<br />

marketing of vacancies, advertising and campaign<br />

led recruitment, competency-based interviewing,<br />

career and recruitment trends.<br />

T: 07834 260029<br />

E: karen.young@hays.com<br />

W: www.hays.co.uk/creditcontrol<br />

The Atradius Collections business model is to support<br />

businesses and their recoveries. We are seeing a<br />

deterioration and increase in unpaid invoices placing<br />

pressures on cashflow for those businesses. Brexit is<br />

causing uncertainty and we are seeing a significant<br />

impact on the UK economy with an increase in<br />

insolvencies, now also impacting the continent and<br />

spreading. Our geographical presence is expanding<br />

and with a single IT platform across the globe we can<br />

provide greater efficiencies and effectiveness to our<br />

clients to recover their unpaid invoices.<br />

T: +44 (0)2920 824700<br />

W: www.atradiuscollections.com/uk/<br />

Shoosmiths’ highly experienced team will work<br />

closely with credit teams to recover commercial<br />

debts as quickly and cost effectively as possible.<br />

We have an in depth knowledge of all areas of debt<br />

recovery, including:<br />

• Pre-litigation services to effect early recovery and<br />

keep costs down • Litigation service • Insolvency<br />

• Post-litigation services including enforcement<br />

As a client of Shoosmiths, you will find us quick to<br />

relate to your goals, and adept at advising you on the<br />

most effective way of achieving them.<br />

T: 03700 86 3000<br />

E: paula.swain@shoosmiths.co.uk<br />

W: www.shoosmiths.co.uk<br />

Forums International has been running <strong>Credit</strong> and<br />

Industry Forums since 1991 covering a range of<br />

industry sectors and international trading. Attendance<br />

is for credit professionals of all levels. Our forums<br />

are not just meetings but communities which<br />

aim to prepare our members for the challenges<br />

ahead. Attending for the first time is free for you to<br />

gauge the benefits and meet the members and we<br />

only have pre-approved Partners, so you will never<br />

intentionally be sold to.<br />

T: +44 (0)1246 555055<br />

E: info@forumsinternational.co.uk<br />

W: www.forumsinternational.co.uk<br />

Improve cash flow, cash collection and prevent late<br />

payment with Corrivo from Data Interconnect.<br />

Corrivo, intelligent invoice to cash automation<br />

highlights where accounts receivable teams should<br />

focus their effort for best results. Easy-to-learn,<br />

Invoicing, Collection and Dispute modules get collection<br />

teams up and running fast. Minimal IT input required.<br />

Real-time dashboards, reporting and self-service<br />

customer portals, improve customer communication<br />

and satisfaction scores. Cost-effective, flexible Corrivo,<br />

super-charges your cash collection effort.<br />

T: +44 (0)1367 245777<br />

E: sales@datainterconnect.co.uk<br />

W: www.datainterconnect.com<br />

Serrala optimizes the Universe of Payments for<br />

organisations seeking efficient cash visibility<br />

and secure financial processes. As an SAP<br />

Partner, Serrala supports over 3,500 companies<br />

worldwide. With more than 30 years of experience<br />

and thousands of successful customer projects,<br />

including solutions for the entire order-to-cash<br />

process, Serrala provides credit managers and<br />

receivables professionals with the solutions they<br />

need to successfully protect their business against<br />

credit risk exposure and bad debt loss.<br />

T: +44 118 207 0450<br />

E: contact@serrala.com<br />

W: www.serrala.com<br />

American Express® is a globally recognised<br />

provider of business payment solutions, providing<br />

flexible capabilities to help companies drive<br />

growth. These solutions support buyers and<br />

suppliers across the supply chain with working<br />

capital and cashflow.<br />

By creating an additional lever to help support<br />

supplier/client relationships American Express is<br />

proud to be an innovator in the business payments<br />

space.<br />

T: +44 (0)1273 696933<br />

W: www.americanexpress.com<br />

C2FO turns receivables into cashflow and payables<br />

into income, uniquely connecting buyers and<br />

suppliers to allow discounts in exchange for<br />

early payment of approved invoices. Suppliers<br />

access additional liquidity sources by accelerating<br />

payments from buyers when required in just two<br />

clicks, at a rate that works for them. Buyers, often<br />

corporates with global supply chains, benefit from<br />

the C2FO solution by improving gross margin while<br />

strengthening the financial health of supply chains<br />

through ethical business practices.<br />

T: 07799 692193<br />

E: anna.donadelli@c2fo.com<br />

W: www.c2fo.com<br />

Esker’s Accounts Receivable (AR) solution removes<br />

the all-too-common obstacles preventing today’s<br />

businesses from collecting receivables in a timely<br />

manner. From invoice delivery to cash application,<br />

Esker automates each step. Esker's automated AR<br />

system powered by TermSync helps companies<br />

modernise without replacing their core billing and<br />

collections processes. By simply automating what<br />

should be automated, customers get the post-sale<br />

experience they deserve and your team gets the<br />

tools they need.<br />

T: +44 (0)1332 548176<br />

E: sam.townsend@esker.co.uk<br />

W: www.esker.co.uk<br />

Advancing the credit profession / www.cicm.com / <strong>June</strong> <strong>2020</strong> / PAGE 37




For further information and<br />

to discuss the opportunities<br />

of entering into a Corporate<br />

Partnership with the CICM,<br />

please contact<br />

corporatepartners@cicm.com<br />

THEY'RE<br />


TALK TO YOU...<br />

Dun & Bradstreet Finance Solutions enable modern<br />

finance leaders and credit professionals to improve<br />

business performance through more effective risk<br />

management, identification of growth opportunities,<br />

and better integration of data and insights<br />

across the business. Powered by our Data Cloud,<br />

our solutions provide access to the world’s most<br />

comprehensive commercial data and insights<br />

supplying a continually updated view of business<br />

relationships that help finance and credit teams<br />

stay ahead of market shifts and customer changes.<br />

T: (0800) 001-234<br />

W: www.dnb.co.uk<br />

Tinubu Square is a trusted source of trade credit<br />

intelligence for credit insurers and for corporate<br />

customers. The company’s B2B <strong>Credit</strong> Risk<br />

Intelligence solutions include the Tinubu Risk<br />

<strong>Management</strong> Center, a cloud-based SaaS platform;<br />

the Tinubu <strong>Credit</strong> Intelligence service and the<br />

Tinubu Risk Analyst advisory service. Over 250<br />

companies rely on Tinubu Square to protect their<br />

greatest assets: customer receivables.<br />

T: +44 (0)207 469 2577 /<br />

E: uksales@tinubu.com<br />

W: www.tinubu.com.<br />

Advancing the credit profession / www.cicm.com / <strong>June</strong> <strong>2020</strong> / PAGE 38


Remote Possibilities<br />

Hiring credit management staff remotely<br />

requires a new set of rules.<br />

AUTHOR – Karen Young<br />

TODAY’S technology has<br />

made remote hiring<br />

possible and as such<br />

it is being carried out<br />

across the world of work.<br />

Encouragingly, credit<br />

functions are still hiring despite an<br />

uncertain business climate, but the hiring<br />

processes looks somewhat different<br />

in light of remote working and social<br />

distancing regulations. As the world of<br />

work has had to make these adjustments<br />

so rapidly, it’s likely that some hiring<br />

managers won’t have extensive experience<br />

of hiring in this way. So, here are four<br />

principles which I think are important<br />

to bear in mind when hiring from afar to<br />

ensure a smooth remote hiring process<br />

and landing the right credit professional<br />

for the role.<br />



It might sound obvious, but a<br />

remote hiring process is different<br />

for both you as an employer and for<br />

a candidate. In light of this, the first<br />

thing you ought to do is outline how the<br />

process will operate from start to finish.<br />

This includes scoping out the different<br />

application stages, what technology you<br />

will be using to carry these out remotely<br />

and who will be involved.<br />

It’s particularly important that you<br />

are clear on the technology you will be<br />

using throughout the process. There are a<br />

huge number of options including Skype,<br />

Microsoft Teams, BlueJeans, FaceTime,<br />

Zoom and GoToMeeting which can be used<br />

for messaging and video interviewing.<br />

Consider, however, that not all candidates<br />

will have access to every platform, so<br />

make sure to come to a mutual agreement<br />

on how the interview will be conducted<br />

and that both parties have all necessary<br />

details and software beforehand.<br />



Despite not being able to meet<br />

your candidate, I’d advise still<br />

preparing as you normally would<br />

throughout the hiring process. It’s in<br />

your interest to find out as much as you<br />

can about your candidate early on in the<br />

hiring process and making sure you are<br />

well versed in your interview technique<br />

even though you will most likely be<br />

conducting interviews over the phone or<br />

video.<br />

Although it feels different carrying<br />

out an interview remotely, technically<br />

everything other than the location should<br />

resemble a physical interview. It will<br />

benefit both parties if the style and format<br />

is familiar, so come with pre-prepared<br />

interview questions including a mix of<br />

technical and behavioural competencybased<br />

questions.<br />

Part of your preparation should also<br />

be to counteract any technical difficulties<br />

by doing a test run of the software<br />

and ensuring all appliances are fully<br />

charged. As you would book a suitable<br />

room for a physical interview, make sure<br />

you are set up comfortably and ensure<br />

your background is appropriate and<br />

professional-looking as the potential<br />

employer. Check your camera angle is<br />

properly positioned before the interview<br />

too.<br />



Getting a feel for a company’s<br />

culture is an integral part of a<br />

candidate’s application process, but<br />

without coming into the office or meeting<br />

colleagues, it can be hard for a candidate<br />

to know what it might be like to work at<br />

your organisation. You can get past this by<br />

making sure you proactively communicate<br />

your company’s value propositions as well<br />

as any facts and figures which shed light<br />

on the way you operate.<br />

An interview provides the opportunity<br />

to communicate this vocally and even<br />

share your personal experiences if you<br />

are chatting more casually. Aside from<br />

this, it might be useful to share your<br />

company’s social media channels with<br />

your candidate as these can offer a good<br />

glimpse of an organisation’s internal<br />

culture. At all stages of the application<br />

process be sure to give the candidate an<br />

opportunity to ask questions about this<br />

too. You could even screen share and walk<br />

them through some of the areas on your<br />

website should you feel it appropriate.<br />

4<br />


You pick up more cues about<br />

someone when you meet them<br />

in person, so when reviewing<br />

your candidates during a remote hiring<br />

process, it may be harder to recall more<br />

nuanced details about them. That’s<br />

where dedicated notetaking will come in<br />

handy, as you’ll have something to refer to<br />

when feeding back to your colleagues or<br />

recruitment consultant.<br />

Despite not knowing how the next<br />

few months will pan out, it is inevitable<br />

that remote hiring will continue and<br />

become more commonplace with new<br />

ways of working. Remembering these<br />

tips and building up your experience in<br />

this way will give you the best chance<br />

of guaranteeing a smooth remote hiring<br />

process with the end result of onboarding<br />

a successful credit professional at the<br />

end.<br />

Karen Young is a Director at<br />

Hays <strong>Credit</strong> <strong>Management</strong>.<br />

Advancing the credit profession / www.cicm.com / <strong>June</strong> <strong>2020</strong> / PAGE 39


The sixth Annual General Meeting of the<br />

Chartered Institute of <strong>Credit</strong> <strong>Management</strong> will be<br />

held on Thursday 11 <strong>June</strong> <strong>2020</strong> at 13:00 (or at the<br />

rising of the Advisory Council from its preceding<br />

meeting, whichever is later). The meeting will<br />

take place virtually, and should you wish to join,<br />

please contact governance@cicm.com by 13:00<br />

on 10 <strong>June</strong> <strong>2020</strong> to request further details.<br />

By order of the Executive Board<br />

Sue Chapple FCICM<br />

Interim Chief Executive<br />

To read the Notice, visit:<br />

http://www.cicm.com/about-cicm/governance/<br />


THE RECOVERY What should your focus be on now?<br />

As the initial crisis settles, now’s the time to focus on navigating our way through the recovery phase.<br />


• Consider Government support mechanisms and loan schemes for you<br />

and your customers.<br />

• Plan recovery action in line with legal moratoriums and suspended<br />

enforcement actions.<br />

• Adjust approach in line with Financial Conduct Authority guidance for<br />

consumer support.<br />


• Review any breaks or weak links in your supply chain and address them<br />

directly.<br />

• Revisit contracts with stakeholders, negotiate temporary new terms to<br />

assist.<br />

• Set contingencies for impacted suppliers, including switch of supply.<br />

• Categorise customer portfolio in line with risk and review regularly.<br />

£<br />


• Develop dynamic ledger management which is responsive to<br />

immediate change.<br />

• Re-write existing collections strategies to fit the current environment.<br />

• Revisit customers with agreed payment holidays and reduced instalments.<br />

• Maximise smaller ledger opportunity to concentrate on older, hard to collect,<br />

debt.<br />

• Revisit and recalculate collection targets with inclusion of impact factors.<br />


• Review <strong>Credit</strong> Policy and risk strategy of your organisation in the current<br />

context.<br />

• Work with Senior <strong>Management</strong> to shape a future exit strategy.<br />

• Review operational processes in line with continued WFH and risk<br />

situations.<br />

• Retain more frequent targets and reviews in a supportive environment.<br />

• Re-write contingency and continuity plans that didn’t work in the crisis.<br />

PEOPLE<br />

• Plan staggered staff reintegration and support mechanisms to assist<br />

the transition.<br />

• Prepare working conditions in and beyond the office under continued<br />

constraints.<br />

• Consider opportunities for more agile working arrangements on a<br />

longer-term basis.<br />


<br />

Contact our Member Advice Service for support, answers and<br />

advice.<br />

Join the CICM Managing <strong>Credit</strong> through the Recovery Forum<br />

on LinkedIn.<br />

Visit our Managing <strong>Credit</strong> through the Recovery<br />

webpage for more resources.<br />

We are developing more resources, please keep in touch with us and join our community.<br />

CICM is your professional body, use it. We are stronger in numbers.<br />

Advancing the credit profession / www.cicm.com / <strong>June</strong> <strong>2020</strong> / PAGE 40


Fatal Attraction<br />

A timely reminder to employers for the need of<br />

clarity when drafting restrictive covenants.<br />

AUTHOR – Gareth Edwards<br />

CAN a new employer be<br />

liable for inducing a<br />

breach of contract where it<br />

knows that an employee is<br />

subject to post-termination<br />

restrictions? That was the<br />

question answered in Allen (t/a David<br />

Allen Chartered Accountants) v Dodd<br />

and Co.<br />

In order to bring a claim in tort for<br />

inducing a breach of contract, the burden<br />

of proof is on the employee’s former<br />

employer. They must show that the new<br />

employer knowingly and intentionally<br />

induced the breach of contract without<br />

reasonable justification, and that the<br />

former employer suffered financial loss as<br />

a result.<br />

The Court of Appeal found that there<br />

will be no inducement where the new<br />

employer honestly believed that the<br />

employee would not be in breach of any<br />

obligations owed to their former employer.<br />

So were the restrictive covenants<br />

enforceable? Dodd & Co had offered Mr<br />

Pollock a job whilst he was still employed<br />

by a competitor, David Allen Chartered<br />

Accountants. Before appointing Mr<br />

Pollock, Dodd & Co obtained legal advice<br />

about whether the post termination<br />

restrictions in his contract of employment<br />

with David Allen were enforceable.<br />

In summary, Dodd & Co’s solicitors<br />

advised that the restrictive covenants<br />

were not enforceable due to a lack of<br />

consideration; the 12-month period<br />

during which the restrictions operated<br />

was too long; the non-dealing ‘on balance’<br />

failed; and the non-solicitation clause was<br />

'probably' unenforceable.<br />

Based on the advice received, Dodd &<br />

Co took the view that whilst the matter<br />

was not entirely without risk, it was more<br />

likely that the restrictive covenants were<br />

unenforceable and appointed Mr Pollock.<br />


David Allen argued that Mr Pollock had<br />

taken up the new role at Dodd & Co in<br />

breach of the restrictive covenants in his<br />

employment contract and made a claim<br />

against Dodd & Co for inducing a breach<br />

of contract. Dodd & Co contested on the<br />

basis that they had relied on the legal<br />

advice obtained that it was more than<br />

likely that the restrictive covenants were<br />

unenforceable. Therefore, they believed<br />

Mr Pollock would not be in breach if he<br />

took up the offer of employment with<br />

them and contacted the clients of his<br />

former firm.<br />

Were Dodd & Co liable? The High<br />

Court had earlier held that Mr Pollock’s<br />

post-termination restrictions were<br />

enforceable. However, it found that<br />

Dodd & Co were not liable for inducing a<br />

breach of contract.<br />

To be valid, it must<br />

be clear that the<br />

restrictive covenants<br />

in an employment<br />

contract protect a<br />

legitimate proprietary<br />

interest.<br />

This was on the basis that they had to<br />

know that they were inducing a breach to<br />

be culpable and having taken legal advice<br />

which indicated the restrictions did not<br />

stand up, it was permissible for them to<br />

conclude that there would be no breach.<br />

It was for David Allen to prove Dodd &<br />

Co had actual knowledge of the breach,<br />

not for Dodd & Co to prove an absolute<br />

belief that there would be no breach.<br />

David Allen was unable to meet this<br />

threshold and Dodd & Co were able to<br />

establish that they honestly believed that<br />

appointing Mr Pollock would not amount<br />

to a breach of contract. Therefore, they<br />

were not liable in tort, even though they<br />

were mistaken in law.<br />

Additionally, the Court rejected<br />

the submission that this requirement<br />

encourages people to obtain bad advice,<br />

and unfairly disadvantages a person<br />

who obtains correct advice. Lord Justice<br />

Lewison stated that it did not matter<br />

whether a defendant’s erroneous belief is<br />

caused by their own ignorance or by the<br />

incorrect advice they received from their<br />

lawyers.<br />


This case acts as a reminder of the<br />

limitations of a claim in tort of inducing<br />

a breach of contract. If responsibly<br />

obtained advice concludes that the<br />

planned actions would be unlikely to<br />

amount to a breach of contract, and<br />

this advice is honestly relied upon, a<br />

new employer would be well placed to<br />

argue that they are not liable for the tort<br />

of inducing a breach. This is even if the<br />

Court arrives at a different conclusion<br />

regarding the enforceability of the<br />

restrictions.<br />

This case also acts as a reminder to<br />

employers for the need of clarity when<br />

drafting restrictive covenants. To be<br />

valid, it must be clear that the restrictive<br />

covenants in an employment contract<br />

protect a legitimate proprietary interest<br />

and the protection sought is no more<br />

than is reasonable having regard to the<br />

interests of the parties and the public<br />

interest. Employers must give serious<br />

thought to the duration and scope of<br />

restrictions to ensure that they are not<br />

unnecessarily wide and are proportionate<br />

to the seniority of the employer and the<br />

role that they perform.<br />

It is also important to note that once<br />

the employer in the above case was put<br />

on notice of the enforceability of the<br />

restrictions, they were bound to observe<br />

them.<br />

Gareth Edwards is a partner in the<br />

employment team at<br />

VWV. gedwards@vwv.co.uk<br />

Advancing the credit profession / www.cicm.com / <strong>June</strong> <strong>2020</strong> / PAGE 41

COVID-19<br />


A financial day of reckoning is coming.<br />

AUTHOR – Kevin Reed<br />

Kevin Reed<br />

THE welter of conversations<br />

I’ve had in recent weeks, the<br />

thousands of words of notes<br />

I’ve collated in preparation for<br />

writing this article…well, I’ve<br />

spent more time gazing at the<br />

blank Word document in front of me than I<br />

have writing.<br />

How do you put down in 1,000 words what<br />

you think businesses have to look forward to<br />

in the coming months? They’ve borrowed,<br />

furloughed, accessed grants and pushed back<br />

their tax bills. But surely, surely, they have to<br />

pay this all back? When and how? Frankly, it’s<br />

a question of where to start.<br />

Two points came to mind in terms of<br />

condensing this situation. Firstly, and<br />

just hours before I began writing this<br />

commentary, TheCityUK research found that<br />

small businesses could be saddled with up<br />

to £105bn in unsustainable debt by March<br />

2021. Secondly, Capitaliser head of education<br />

Phil Hobden said to me, concisely, that<br />

businesses will be operating from a position<br />

of “…reduced income, sustained costs.”<br />

This is the stark reality facing the UK<br />

economy. How can businesses get back on<br />

their feet, in what will be ongoing and trying<br />

circumstances, while saddled with debt?<br />


If we start with the basics, which doesn’t<br />

always happen in the business world<br />

(certainly when it comes to financial<br />

management), there has been a wide range<br />

of support offered by the government,<br />

and ‘in partnership’ with banks/lenders.<br />

Furloughing of staff has allowed businesses<br />

to dramatically ease their financial burden,<br />

but many have operated a ‘shadow of its<br />

former self’ operation, meaning that lots<br />

of thought has gone into who carries on<br />

working, what they undertake and of course<br />

how to manage – in the broadest sense –<br />

those furloughed.<br />

Alongside this, there have been numerous<br />

grant and loan schemes that have introduced<br />

a range of acronyms for professionals to<br />

grasp with: CBILS, BBLS and SEISS are now<br />

part of the finance lexicon.<br />

Generally, the business advisory<br />

community has welcomed the speed and<br />

depth of which these schemes have been<br />

introduced. On top of those schemes, we’ve<br />

seen tax deferral arrangements proffered,<br />

from skipping VAT payments through to<br />

the old chestnut: Time To Pay. But while we<br />

operate in an ultra-low interest jurisdiction,<br />

loans and tax have to be paid back. Advisers<br />

I speak to are fearful about the mediumterm.<br />

They see businesses attempting to get<br />

back on their feet, but facing the death knell,<br />

or day of reckoning, that is their first set of<br />

repayments.<br />

“Businesses…have attempted to inject cash<br />

and reduce their costs by any means possible.<br />

This short termism, whilst understandable,<br />

could have potentially fatal consequences for<br />

the longer-term future of these businesses,”<br />

Factotum CEO Bobby Lane told me.<br />

“If trading levels do not return at the<br />

pace required to rebuild cash reserves and<br />

generate profits, where will the cash come<br />

from for these repayments?”<br />

He has heard of businesses that think<br />

they’ll be able to default on CBILS loans<br />

because it’s 80 percent government-backed<br />

money. In other words, they only owe ‘20<br />

percent’ of the actual loan value. Such<br />

thinking is, of course, misguided and<br />

disastrous.<br />

Grants are grants – they do what they say<br />

on the tin. But ‘free money’ can set the pounds<br />

signs ‘kerchinging’ in the eyes of directors…<br />

I hope there hasn’t been too much greed<br />

around this area – whether furloughed staff<br />

continuing to work, or over-generous SEISS<br />

claims. I wonder if such ‘business benefit<br />

fraud’ will be a headline maker in 2021.<br />


There is much discussion about who actually<br />

‘owes’ this money; this funding. Is it the<br />

taxpayer or the government? It seems a<br />

strange question but it’s certainly important<br />

from a policy perspective.<br />

If we’re ‘all in this together’, will the<br />

chancellor announce sweeping tax increases<br />

to cover the funding, and where will they<br />

land? Will VAT and CT tick up? Windfall<br />

taxes might come into play for sectors that<br />

are politically easy to target and have deep<br />

pockets (I’m thinking of the tech monoliths,<br />

naturally…).<br />

But after ten years’ austerity, tightening<br />

belts won’t be a popular message. There’s<br />

little point at looking for governmental<br />

efficiencies…it’s unlikely their departments<br />

can realistically be squeezed any more.<br />

The NHS, for instance, would be a very bad<br />

place to aim austerity measures – more like a<br />

complete political implosion. It’s likely to be<br />

Advancing the credit profession / www.cicm.com / <strong>June</strong> <strong>2020</strong> / PAGE 42

COVID-19<br />

AUTHOR – Kevin Reed<br />

the reverse: extra health funding will have to<br />

be put in place… let alone a coherent (and wellfunded)<br />

pandemic/disaster recovery strategy.<br />

Brendon Howlett, of accountants Wood and<br />

Disney, summed up the mood when speaking<br />

to me: “Shouldn’t the government take some<br />

responsibility itself for its lack of planning for<br />

this pandemic and the dithering; its lack of<br />

transparency; the poor state of the NHS pre-<br />

Coronavirus and the shocking supply chain<br />

issues around PPE? How can they put this on<br />

the taxpayer?”<br />

Views on the taxation question seem split,<br />

from social media commentary and my own<br />

conversations. Some think that belt-tightening<br />

and tax rises will happen at the start of 2021.<br />

Others think that, by doing this, it defeats the<br />

purpose of the stimulus.<br />

“I’d suggest a lower tax take, super-charge the<br />

economy by keeping taxes low and, in effect,<br />

fund small business,” says Bruce Burrowes of<br />

accountancy firm Kingston Burrowes.<br />

For him, the lost take will “be more than<br />

repaid” by the growth in business and bigger<br />

tax take in the long-term. If the government<br />

provides a stable environment for business,<br />

smoothing the tax and lending repayments,<br />

then it is businesses’ job to fund that stability<br />

by growing. “We just need to ensure they both<br />

continue to support each other,” Burrowes adds.<br />

It seems that any hauling-in of the nets<br />

by either the banks or the government – too<br />

much or too quickly – will reverse any potential<br />

stabilisation or momentum (hopefully) found<br />

This is the stark<br />

reality facing the<br />

UK economy. How<br />

can businesses<br />

get back on their<br />

feet, in what will be<br />

ongoing and trying<br />

circumstances,<br />

while saddled with<br />

debt?<br />

in the next few months. But the longer it takes<br />

government to recoup the debt, then the less<br />

value it will hold – adversely impacting the<br />

spending power of governments for future<br />

generations.<br />


Perhaps the true test of how far the government<br />

can go will come from understanding voters’<br />

sentiment. In recent years there has been<br />

pushback against ‘greedy corporates and<br />

executives.’ It will be fascinating to see how the<br />

public’s view of business is refocussed once we<br />

start to progress.<br />

Will our businesses’ efforts to restart,<br />

maintaining the public’s gainful employment,<br />

be hailed as effectively supporting citizens’<br />

prosperity? Will the public appreciate that<br />

profits being paid out in dividends support our<br />

pension pots, or will they expect all surplus cash<br />

to be paid back into government coffers through<br />

tax and debt repayment?<br />

It is all a balancing act, as has always been<br />

the case when it comes to the economy, politics<br />

and its people. But the stakes have never been<br />

higher.<br />

Many thanks to Bruce Burrowes, Phil<br />

Hobden, Brendon Howlett, Bobby Lane, Nick<br />

Levine, John McNamara, John McNamara and<br />

Carl Reader for their thoughts.<br />

Kevin Reed is a freelance journalist and former<br />

editor of both Accountancy Age and Financial<br />

Director.<br />

Advancing the credit profession / www.cicm.com / <strong>June</strong> <strong>2020</strong> / PAGE 43


Do you know someone who would benefit from CICM membership? Or have<br />

you considered applying to upgrade your membership? See our website<br />

www.cicm.com/membership-types for more details, or call us on 01780 722903<br />

Fellow<br />

David Ratnam FCICM<br />

Member<br />

Naveed Iqbal MCICM<br />

Associate<br />

Hannah Dent ACICM<br />

Tracey Woodcock ACICM<br />

Studying Member<br />

Murad .<br />

Lucy Aldis<br />

Helen Arney<br />

Jessica Barrett<br />

Claire Burke<br />

John Davies<br />

Lee Fawcett<br />

Angela Hall<br />

Natalia Henwood<br />

Lance Jinks<br />

Deemple Kaur<br />

Hayley Marques-Hoffmann<br />

Rhiri Otobo<br />

Luke Peacock<br />

Heather Peters<br />

Fatgia Pietersen<br />

Joseph Potter<br />

Susan Randle<br />

Luca Sarrocco<br />

Gareth Short<br />

Harry Stewart<br />

Chahira Taibi<br />

Cristina Turturean<br />

Trudy Woolley<br />

Affiliate<br />

Rebecca Williams Carmel James Beverley Ryan<br />

Group <strong>Credit</strong> Manager, TXM Group<br />

Steve Charter FCICM<br />

‘‘I got involved with the CICM as it is widely recognised as the standard for the role that I<br />

do and I believe it would give the best standing for my current, and future career. I’ve been<br />

with TXM Group for 10 years and have grown so much in that time, culminating in being a<br />

finalist for numerous CICM awards and achieving FCICM status.’’<br />


Man of Stature<br />

Paul Mudge FCICM, former ICM President and the first Chief Executive of Registry Trust has died.<br />

BORN in the West Country, Paul was a<br />

man of stature, tall and charming. He had<br />

been an executive with Curry's when it was<br />

an independent electrical retailer and a<br />

leading figure nationally in the ICM. Curry's<br />

had been taken over by Dixons so Paul was<br />

available when Vic Ware of Burtons and<br />

David Cavell of the Co-operative Bank were<br />

leading the industry initiative to maintain<br />

the Registry of County Court Judgments.<br />

By 1995 Vic Ware, I and an alliance<br />

of industry and consumers had started<br />

Registry Services. It was a pathfinder<br />

company to prepare to receive the millions<br />

of scraps of paper which comprised the<br />

physical register. Vic recommended Paul<br />

as Chief Executive and Vic's word went.<br />

In the initial team Paul was joined by his<br />

Number Two from Curry's Jon Hale and,<br />

on secondment from my private office, the<br />

outstandingly talented Terricita Massally.<br />

By then Paul was president of the ICM,<br />

well liked and respected throughout the<br />

industry and profession. The flow of<br />

information from the courts was erratic<br />

in those days. They had a measure of<br />

independence and the Department of<br />

Constitutional Affairs was not assiduous in<br />

pursuit. Certainly, some court managers<br />

and ministry staff felt people had suffered<br />

enough, without the additional scar of<br />

registration. As a result, a number of<br />

courts sent a small sample, others none at<br />

all!<br />

Paul deployed his charm and authority<br />

to ensure the smooth flow of information<br />

to Registry Trust, creating a complete<br />

register for the first time in living memory.<br />

Over seven years he visited most of the<br />

200 or so courts in England and Wales,<br />

soon becoming better known and more of<br />

a national figure than any Departmental<br />

official. If he revisited courts in the West<br />

Country more than anywhere else that was<br />

his privilege.<br />

Jon Hale was effectively chief operating<br />

officer from the start, so Paul was free<br />

to concentrate on the courts and the<br />

Department, to create the warm, friendly<br />

and well-mannered style of the company<br />

and to develop good relations with the<br />

lending world.<br />

The comprehensive register which is so<br />

important to the national economy today<br />

is a testament to Paul's assiduity. He went<br />

on to enjoy a happy retirement in the<br />

southwest (by then London SW rather than<br />

the West Country). He was predeceased<br />

by his equally charming wife, Sally. The<br />

family is making arrangements for a<br />

memorial service later in the year.<br />

Author: Malcolm Hurlston<br />

Advancing the credit profession / www.cicm.com / <strong>June</strong> <strong>2020</strong> / PAGE 44

www.cicm.com<br />

‘‘<br />

CICM offered the<br />

prospect of qualifications,<br />

but as soon as I became<br />

a member, loads of other<br />

opportunities came to<br />

light that I hadn’t initially<br />

realised were available.<br />

Molly Kane<br />

ACICM<br />

The value<br />

of CICM<br />

membership<br />

Molly Kane ACICM<br />

Senior <strong>Credit</strong> Controller Executive<br />

Oxford University<br />

Read more about her story and join your<br />

credit community by visiting:<br />

www.cicm.com/value-of-cicm-membership/<br />

info@cicm.com<br />

www.cicm.com<br />

01780 722900


Sustainable<br />

Development<br />

How a sustainability strategy is more<br />

than just about saving the planet.<br />

AUTHOR – Camilla Backstrom<br />

BANKS and other financial<br />

institutions are constantly<br />

looking at ways of<br />

differentiating themselves<br />

from their competitors.<br />

New product innovation<br />

or client services initiatives are ordinarily<br />

the first on the list, alongside attracting<br />

the best talent by making themselves<br />

great places to work.<br />

The more imaginative institutions,<br />

however, are going further, creating<br />

strategies around sustainability that are<br />

not only good for their stakeholders and the<br />

environment, but also contribute directly<br />

to an improved financial performance.<br />

They are creating permanent strategies<br />

that are an intrinsic part of the business,<br />

as opposed to a temporary initiative to<br />

gain short-term attention. They are also<br />

demonstrating that sustainability delivers<br />

real value for all stakeholders when it<br />

is properly integrated and part of the<br />

company value proposition.<br />

The concept of ‘sustainability’ means<br />

different things to different people and<br />

different industries. To those in the<br />

manufacturing industry, for example,<br />

it is about doing the same or more with<br />

less – less material, fewer chemicals,<br />

less water, less energy – and by being<br />

more sustainable, they are reducing<br />

their carbon footprint and engendering<br />

customer loyalty. In the financial sector,<br />

it can be about investing in sustainable<br />

businesses. When looking deeper into the<br />

financial services sector, however, there is<br />

another key driver that is less about the<br />

environment and more about focusing<br />

on the social factors of sustainability,<br />

where the customer and employees are<br />

at the core. ‘Traditional’ sustainability<br />

strategies in multinational companies<br />

have had challenges to create real impact<br />

because they tend to be top down and<br />

dictated by head office. As such, it is<br />

seldom a part of the company’s true<br />

DNA. A more successful approach is to<br />

create a strategy that is ‘bottom up’, that<br />

takes as its principal guide the input of<br />

operational staff, who have a more ‘hands<br />

on’ understanding of what is material,<br />

and where the focus needs to be.<br />


Regardless of how the strategy is<br />

derived, what is essential is that it must<br />

be connected to an institution’s value<br />

creation model. It requires a vision that<br />

speaks to all stakeholders; in the case of<br />

many in the financial services sector, for<br />

example, it is about focussing on a more<br />

inclusive society. And it needs a clear set of<br />

objectives, to ensure customer satisfaction<br />

and offer new inclusive services, and treat<br />

customers and employees ethically and<br />

fairly, while complying with applicable<br />

laws and regulations.<br />

Financial inclusion is a growing pan-<br />

European challenge with increasing<br />

attention from governments and the<br />

financial sector. If you take a business<br />

engaged in debt resolution, customers<br />

discover that it is not always enough to<br />

pay off a debt in order to be included in<br />

the financial ecosystem. Many are still<br />

categorised as so-called ‘high-risk’, and<br />

consequently this prevents them from<br />

accessing affordable financial products<br />

and services.<br />

If we look for a moment at the<br />

approach that Hoist Finance is taking, by<br />

way of example, then our mission to ‘help<br />

people keep their commitments’ clearly<br />

communicates our intention to support<br />

customers in their journey to re-enter<br />

the financial ecosystem. This requires<br />

the building of trust and relationships<br />

with a sensitivity to what can often be a<br />

challenging situation for the customer.<br />

Every customer interaction must be on the<br />

basis of finding amicable solutions, and<br />

this is being greatly assisted by a digital<br />

strategy that enables an institution like<br />

ours to better understand the customers’<br />

needs and develop processes that support<br />

customer driven development.<br />

Second only to the customer in creating<br />

an effective sustainability strategy is<br />

a focus on employees. Ask any Chief<br />

Executive to tell you his/her most valuable<br />

asset and they will always say their people.<br />

Recruiting and retaining the best people,<br />

with the right drive and passion to help<br />

you deliver on your mission and goals, is<br />

essential.<br />


The debt resolution sector – in which<br />

companies acquire portfolios of debt<br />

and, by nature of the industry, effectively<br />

‘acquire’ customers – is more challenging<br />

than most. Most of the employees are<br />

customer contact representatives dealing<br />

directly with customer calls, and some<br />

of these interactions can be difficult<br />

and emotionally trying. Creating a great<br />

place to work takes on even greater<br />

significance and is arguably more<br />

difficult than other mainstream financial<br />

institutions. It requires close attention to<br />

an employee’s health and well-being. It<br />

also requires sensitivity to diversity and<br />

gender equality to ensure every employee<br />

feels empowered, supported and proud<br />

to work for their employer. The third of<br />

the stakeholder groups are the clients<br />

themselves, which in the debt resolution<br />

space means the banks and other financial<br />

institutions who entrust their portfolios<br />

to their debt resolution partners. In<br />

much the same way as a sustainability<br />

strategy needs to demonstrate a mutually<br />

inclusive, flexible approach to managing<br />

customers, it needs to deliver the same<br />

levels of commitment when managing<br />

clients, delivering solutions that suit their<br />

needs.<br />

Of course, no sustainability strategy<br />

would be complete without reference to<br />

the environment and combatting climate<br />

change. Even though financial institutions<br />

do not manufacture or build products,<br />

they can still play their part in reducing<br />

waste and maximising resources. Actively<br />

encouraging customers to engage digitally,<br />

for example, can have a significant<br />

impact on the number of letters they<br />

need to receive, with the commensurate<br />

reduction in paper and postage. (To put<br />

Advancing the credit profession / www.cicm.com / <strong>June</strong> <strong>2020</strong> / PAGE 46


Hoist Finance sent out<br />

10 million letters to<br />

customers across Europe<br />

in 2019 and is looking<br />

to reduce this total<br />

by 10 percent in <strong>2020</strong>,<br />

primarily by pursuing its<br />

digital agenda.<br />

this into context, Hoist Finance sent out<br />

10 million letters to customers across<br />

Europe in 2019 and is looking to reduce<br />

this total by 10 percent in <strong>2020</strong>, primarily<br />

by pursuing its digital agenda.) Similarly,<br />

actively encouraging employees to travel<br />

less is also an easy way of meeting an<br />

environmental target.<br />


Embedding a sustainability strategy<br />

within a company’s wider Environmental,<br />

Social and Governance (ESG) objectives<br />

ensures that while the strategy may<br />

have been bottom up, it still commands<br />

the attention and control of the<br />

Executive <strong>Management</strong> Team. But how<br />

is success measured? And perhaps more<br />

importantly, why should a business be<br />

bothered about sustainability at all?<br />

Measuring success is indeed a challenge.<br />

As with any strategy that is effectively<br />

‘new’ and therefore untried, targets tend<br />

to be arbitrary, a gut feel for what seems<br />

to be reasonable. It seems reasonable,<br />

for example, to reduce the number<br />

of letters sent out every year by 10%<br />

and look to reduce travel by a similar<br />

amount. It seems reasonable too to look<br />

at improvements in customer satisfaction<br />

surveys and the Great Places to Work<br />

index to measure how the strategy is<br />

improving the lives of your customers<br />

and employees.<br />

Arguably the most significant<br />

measure of success is an improvement<br />

to the bottom line, for that has to be the<br />

strategy’s ultimate objective. Customers<br />

who feel valued are more likely to agree<br />

to a repayment plan and stick to it;<br />

employees who are supported, engaged<br />

and happy in their work are more<br />

productive; and clients who see that you<br />

are well managed and focussed – beyond<br />

your regulatory obligations – are more<br />

likely to trust you with their portfolios<br />

and work with you over the longer term.<br />

Sustainability is much more that<br />

simply ticking a box to save the planet. In<br />

the future, the most successful financial<br />

institutions will be those who have taken<br />

sustainability to their core and integrate<br />

it into the fabric of business.<br />

Camilla Backstrom is the Head of<br />

Sustainability at Hoist Finance.<br />

Advancing the credit profession / www.cicm.com / <strong>June</strong> <strong>2020</strong> / PAGE 47





Salford, £highly competitive<br />

Bibby Financial Services is a global provider of innovative funding<br />

solutions that seeks a national commercial recoveries executive<br />

to ensure its profitability through effective debt collection.<br />

The role provides a high level of service through successfully<br />

handling objections with a firm but professional approach.<br />

Speaking to debtors daily, you will recognise and escalate<br />

complex issues, as well as effectively prioritise tasks within<br />

a defined framework. Ref: 3800095<br />

Contact adam.crossland@hays.com, call 0161 236 7272<br />

or visit webmicrosites.hays.co.uk/web/bibby-financial-services<br />


London, up to £32,000<br />

A financial services company is looking to rapidly increase their<br />

finance function after expanding their services. Your role as the<br />

debt collections officer will be to build a relationship with SME’s<br />

and providing excellent customer support. You will be preparing<br />

and maintaining payment plans with companies and providing<br />

solutions on how to recover debt in an amicable manner.<br />

Prior debt collection experience is preferred. Ref: 3805053<br />

Contact Leo Yang on 07597 057719<br />

or email leo.yang@hays.com<br />


London, up to £50,000 + bonus<br />

A rare opportunity has arisen at an established trading<br />

business for a highly motivated individual. With a strong<br />

emphasis on billing of different energy rates and suppliers of<br />

various commercial units, you will be expected to have expert<br />

proficiency in this market. The role focuses upon maximising<br />

the profitability of the outstanding amounts that has been<br />

billed and minimising exposure to risk.<br />

Ref: 3806827<br />

Contact Akshay Caussy on 07572 612397<br />

or email akshay.caussy@hays.com<br />


Birmingham, £23,000-£25,000<br />

A large blue-chip company, that is striving to become a<br />

CICMQ centre of excellence is looking for a credit controller<br />

to join its high performing team. During a period of growth<br />

for the business, this role offers support with CICM studies<br />

and a clear progression path in the order to cash team.<br />

Ideally, you will have previous experience in the credit industry.<br />

Ref: 3786212<br />

Contact Peter Kidd on 07387 157254<br />

or email peter.kidd@hays.com<br />

hays.co.uk/creditcontrol<br />

Advancing the credit profession / www.cicm.com / <strong>June</strong> <strong>2020</strong> / PAGE 48


Edinburgh, up to £23,000<br />

A well-known public sector organisation is looking to add a<br />

credit control professional into its team. You will be responsible<br />

for the timely and accurate collection of debts due to the<br />

organisation. You will need previous experience in accounts<br />

with a focus on credit control as well as experience of having<br />

sensitive conversations in a polite and respectful manner.<br />

The ability to maintain company policy and conduct excellent<br />

customer service skills are also required. Ref: 3809131<br />

Contact Megan Neil on 0131 603 8374<br />

or email megan.neil@hays.com<br />


Wimbledon, up to £14.34 per hour + bonus<br />

A professional services organisation requires a credit controller<br />

to be responsible for the collection of debt, with the ambition<br />

to reduce ageing debt. You will liaise with internal departments<br />

in finance and administration, as well as sales teams to resolve<br />

problems in order to receive payment in a timely manner.<br />

Experience with cloud-based systems is desirable and proficient<br />

Excel knowledge is essential. This is an exciting temporary role<br />

for minimum 3 months with an option to extend. Ref: 3811785<br />

Contact Mark Ordoña on 020 8247 4042<br />

or email mark.ordona@hays.com<br />

This is just a small selection of the many opportunities we have<br />

available for credit professionals. To find out more visit us<br />

online or contact Kabir Gulabkhan, Hays <strong>Credit</strong> <strong>Management</strong><br />

UK Lead on 020 3465 0020<br />

Advancing the credit profession / www.cicm.com / <strong>June</strong> <strong>2020</strong> / PAGE 49

WHAT'S ON<br />

We are asking all members to invite a colleague to a CICM membership event,<br />

free of charge. Book online on our website www.cicm.com/cicm-events<br />


We are not able to bring our usual guide<br />

to the CICM and Industry events, as the<br />

calendar and what is on is changing daily.<br />

Many of our events are now available<br />

online, along with a new series of live and<br />

recorded webinars for the credit profession.<br />

Check our website for updates and<br />

instructions on how to register.<br />

Advancing the credit profession / www.cicm.com / <strong>June</strong> <strong>2020</strong> / PAGE 50

More reasons to be a member<br />

Make connections and keep up-to-date<br />

with our exclusive events.<br />

Studying at a<br />

distance<br />

with CICM<br />

From interactive virtual classrooms to supporting texts,<br />

from mentor advice to peer support, we’ve got it all.<br />

Contact CICM for more information on any of these services,<br />

or check them out at cicm.com<br />

Giving you the tools to continue<br />

working through this crisis.<br />


THE RECOVERY What should your focus be on now?<br />

CICM has launched the Managing <strong>Credit</strong> Through the Recovery suite of tools and services for<br />

all credit professionals. Check for new resources, tools and news daily at<br />

https://www.cicm.com/managing-credit-through-the-recovery-checklist/<br />

Join the CICM Managing <strong>Credit</strong> Through The Recovery LinkedIn discussion group today.<br />

We are developing more resources, advice and tools daily,<br />

please keep in touch with us and join our community.<br />

CICM is your professional body, use it. We are stronger in numbers.<br />

Advancing the credit profession / www.cicm.com / <strong>June</strong> <strong>2020</strong> / PAGE 51

Cr£ditWho?<br />

CICM Directory of Services<br />




Controlaccount Plc<br />

Address: Compass House, Waterside, Hanbury Road,<br />

Bromsgrove, Worcestershire B60 4FD<br />

T: 01527 549 522<br />

E: sales@controlaccount.com<br />

W: www.controlaccount.com<br />

Controlaccount Plc provides an efficient, effective and ethical<br />

commercial debt recovery service focused on improving business<br />

cash flow whilst preserving customer relationships and established<br />

reputations. Working with leading brand names in the UK and<br />

internationally, we deliver a bespoke service to our clients. We offer<br />

a no collect, no fee service without any contractual ties in. Where<br />

applicable, we can utilise the Late Payment of Commercial Debts<br />

Act (2013) to help you redress the cost of collection. Our clients<br />

also benefit from our in-house international trace and legal counsel<br />

departments and have complete transparency and up to the minute<br />

information on any accounts placed with us for recovery through our<br />

online debt management system, ClientWeb.<br />


Baker Ing International Limited<br />

Office 7, 35-37 Ludgate Hill, London. EC4M 7JN<br />

Contact: Lisa Baker-Reynolds<br />

Email: lisa@bakering.global<br />

Website: https://www.bakering.global/contact/<br />

Tel: 07717 020659<br />

Baker Ing International is a dedicated team of <strong>Credit</strong> industry<br />

experience that, combined, covers time served in most industries.<br />

The team is wholly comprised of working <strong>Credit</strong> Manager’s across<br />

the Globe with a minimum threshold of ten years working experience<br />

within <strong>Credit</strong> <strong>Management</strong>. The team offers a comprehensive<br />

service to clients - International Debt Recovery, <strong>Credit</strong> Control, Legal<br />

Services & more<br />

Our mission is to help companies improve the cost and efficiency<br />

of their <strong>Credit</strong> <strong>Management</strong> processes in order to limit the risks<br />

associated with extending credit and trading around the globe.<br />

How can we help you - call Lisa Baker Reynolds on<br />

+44(0)7717 020659 or email lisa@bakering.global<br />


Lovetts Solicitors<br />

Lovetts, Bramley House, The Guildway,<br />

Old Portsmouth Road,<br />

Guildford, Surrey, GU3 1LR<br />

T: 01483 347001<br />

E: info@lovetts.co.uk<br />

W: www.lovetts.co.uk<br />

With more than 25yrs experience in UK & international business debt<br />

collection and recovery, Lovetts Solicitors collects £40m+ every year<br />

on behalf of our clients. Services include:<br />

• Letters Before Action (LBA) from £1.50 + VAT (successful in 86%<br />

of cases)<br />

• Advice and dispute resolution<br />

• Legal proceedings and enforcement<br />

• 24/7 access to your cases via our in-house software solution,<br />

CaseManager<br />

Don’t just take our word for it, here’s some recent customer feedback:<br />

“All our service expectations have been exceeded. The online<br />

system is particularly useful and extremely easy to use. Lovetts has a<br />

recognisable brand that generates successful results.”<br />

Atradius Collections Ltd<br />

3 Harbour Drive,<br />

Capital Waterside, Cardiff, CF10 4WZ<br />

Phone: +44 (0)29 20824397<br />

Mobile: +44 (0)7767 865821<br />

E-mail:yvette.gray@atradius.com<br />

Website: atradiuscollections.com<br />

Atradius Collections Ltd is an established specialist in business<br />

to business collections. As the collections division of the Atradius<br />

Crédito y Caución, we have a strong position sharing history,<br />

knowledge and reputation.<br />

Annually handling more than 110,000 cases and recovering over<br />

a billion EUROs in collections at any one time, we deliver when<br />

it comes to collecting outstanding debts. With over 90 years’<br />

experience, we have an in-depth understanding of the importance of<br />

maintaining customer relationships whilst efficiently and effectively<br />

collecting monies owed.<br />

The individual nature of our clients’ customer relationships is<br />

reflected in the customer focus we provide, structuring our service<br />

to meet your specific needs. We work closely with clients to provide<br />

them with a collection strategy that echoes their business character,<br />

trading patterns and budget.<br />

For further information contact Yvette Gray Country Director, UK<br />

and Ireland.<br />

Premium Collections Limited<br />

3 Caidan House, Canal Road<br />

Timperley, Cheshire. WA14 1TD<br />

T: +44 (0)161 962 4695<br />

E: paul.daine@premiumcollections.co.uk<br />

W: www.premiumcollections.co.uk<br />

For all your credit management requirements Premium Collections<br />

has the solution to suit you. Operating on a national and international<br />

basis we can tailor a package of products and services to meet your<br />

requirements.<br />

Services include B2B collections, B2C collections, international<br />

collections, absconder tracing, asset repossessions, status reporting<br />

and litigation support.<br />

Managed from our offices in Manchester, Harrogate and Dublin our<br />

network of 55 partners cover the World.<br />

Contact Paul Daine FCICM on +44 (0)161 962 4695 or<br />

paul.daine@premiumcollections.co.uk<br />

www.premiumcollections.co.uk<br />

Blaser Mills Law<br />

40 Oxford Road,<br />

High Wycombe,<br />

Buckinghamshire. HP11 2EE<br />

T: 01494 478660<br />

E: Jackie Ray jar@blasermills.co.uk<br />

W: www.blasermills.co.uk<br />

A full-service firm, Blaser Mills Law’s experienced Commercial<br />

Recoveries team offer pre-legal collections, debt recovery,<br />

litigation, dispute resolution and insolvency. The team includes<br />

CICM qualified staff, recommended in both Legal 500 and<br />

Chambers & Partners legal directories.<br />

Offices in High Wycombe, Amersham, Rickmansworth, London<br />

and Silverstone<br />

Keebles<br />

Capitol House, Russell Street, Leeds LS1 5SP<br />

T: 0113 399 3482<br />

E: charise.marsden@keebles.com<br />

W: www.keebles.com<br />

Keebles debt recovery team was named “Legal Team of the Year”<br />

at the 2019 CICM British <strong>Credit</strong> Awards.<br />

According to our clients “Keebles stand head and shoulders above<br />

others in the industry. A team that understands their client’s<br />

business and know exactly how to speedily maximise recovery.<br />

Professional, can do attitude runs through the team which is not<br />

seen in many other practices.”<br />

We offer a service with no hidden costs, giving you certainty and<br />

peace of mind.<br />

• ‘No recovery, no fee’ for pre-legal work.<br />

• Fixed fees for issuing court proceedings and pursuing claims to<br />

judgment and enforcement.<br />

• Success rate in excess of 80%.<br />

• 24 hour turnaround on instructions.<br />

• Real-time online access to your cases to review progress.<br />


Sanders Consulting Associates Ltd<br />

T: +44(0)1525 720226<br />

E: enquiries@chrissandersconsulting.com<br />

W: www.chrissandersconsulting.com<br />

Sanders Consulting is an independent niche consulting firm<br />

specialising in leadership and performance improvement in all aspects<br />

of the order to cash process. Chris Sanders FCICM, the principal, is<br />

well known in the industry with a wealth of experience in operational<br />

credit management, billing, change and business process improvement.<br />

A sought after speaker with cross industry international experience in<br />

the business-to-business and business-to-consumer markets, his<br />

innovative and enthusiastic approach delivers pragmatic people and<br />

process lead solutions and significant working capital improvements to<br />

clients. Sanders Consulting are proud to manage CICMQ on behalf of<br />

and under the supervision of the CICM.<br />


Court Enforcement Services<br />

Wayne Whitford – Director<br />

M: +44 (0)7834 748 183 T : +44 (0)1992 663 399<br />

E : wayne@courtenforcementservices.co.uk<br />

W: www.courtenforcementservices.co.uk<br />

High Court Enforcement that will Empower You!<br />

We help law firms and in-house debt recovery and legal teams to<br />

enforce CCJs by transferring them up to the High Court. Setting us<br />

apart in the industry, our unique and Award Winning Field Agent App<br />

helps to provide information in real time and transparency, empowering<br />

our clients when they work with us.<br />

• Free Transfer up process of CCJ’s to High Court<br />

• Exceptional Recovery Rates<br />

• Individual Client Attention and Tailored Solutions<br />

• Real Time Client Access to Cases<br />

Advancing the credit profession / www.cicm.com / <strong>June</strong> <strong>2020</strong> / PAGE 52


russell@cabbells.uk 0203 603 7937<br />




CoCredo<br />

Missenden Abbey, Great Missenden, Bucks, HP16 0BD<br />

T: 01494 790600<br />

E: customerservice@cocredo.com<br />

W: www.cocredo.co.uk<br />

We provide business information on over 256 million companies across<br />

221 countries. Our information is updated over 500,000 times per<br />

day and we have some excellent tracking mechanisms which provide<br />

proactive daily monitoring of changes in the global information on record.<br />

We can offer a wealth of additional services including XML Integration,<br />

D.N.A portfolio management, CoData marketing information, Companies<br />

House documents, Consumer and Director Searches. We pride ourselves<br />

in delivering award winning customer service, offering you unrivalled<br />

support and analysis to protect your business.<br />

Graydon UK<br />

66 College Road, 2nd Floor, Hygeia Building, Harrow,<br />

Middlesex, HA1 1BE<br />

T: +44 (0)208 515 1400<br />

E: customerservices@graydon.co.uk<br />

W: www.graydon.co.uk<br />

With 130+ years of experience, Graydon is a leading provider of<br />

business information, analytics, insights and solutions. Graydon<br />

helps its customers to make fast, accurate decisions, enabling them<br />

to minimise risk and identify fraud as well as optimise opportunities<br />

with their commercial relationships. Graydon uses 130+ international<br />

databases and the information of 90+ million companies. Graydon<br />

has offices in London, Cardiff, Amsterdam and Antwerp. Since 2016,<br />

Graydon has been part of Atradius, one of the world’s largest credit<br />

insurance companies.<br />

Tinubu Square UK<br />

Holland House, 4 Bury Street,<br />

London EC3A 5AW<br />

T: +44 (0)207 469 2577 /<br />

E: uksales@tinubu.com<br />

W: www.tinubu.com<br />

Founded in 2000, Tinubu Square is a software vendor, enabler of the<br />

<strong>Credit</strong> Insurance, Surety and Trade Finance digital transformation.<br />

Tinubu Square enables organizations across the world to significantly<br />

reduce their exposure to risk and their financial, operational and technical<br />

costs with best-in-class technology solutions and services. Tinubu<br />

Square provides SaaS solutions and services to different businesses<br />

including credit insurers, receivables financing organizations and<br />

multinational corporations.<br />

Tinubu Square has built an ecosystem of customers in over 20 countries<br />

worldwide and has a global presence with offices in Paris, London, New<br />

York, Montreal and Singapore.<br />



SmartSearch<br />

SmartSearch, Harman House,<br />

Station Road,Guiseley, Leeds, LS20 8BX<br />

T: +44 (0)113 238 7660<br />

E: info@smartsearchuk.com W: www.smartsearchuk.com<br />

KYC, AML and CDD all rely on a combination of deep data with broad<br />

coverage, highly automated flexible technology with an innovative<br />

and intuitive customer interface. Key features include automatic<br />

Worldwide Sanction & PEP checking, Daily Monitoring, Automated<br />

Enhanced Due Diligence and pro-active customer management.<br />

Choose SmartSearch as your benchmark.<br />

CEDAR<br />

ROSE<br />

R<br />

Cedar Rose<br />

3, Georgiou Katsonotou Street,3036, Limassol, Cyprus<br />

E: info@cedar-rose.com T: +357 25346630<br />

W: www.cedar-rose.com<br />

Cedar Rose has been globally recognised as the expert for<br />

credit reports, due diligence and data for the Middle East<br />

and North African countries since 1997. We now cover over<br />

170 countries with the same high quality, expert analysis<br />

and attention to detail we are well-known and trusted for.<br />

Making best use of artificial intelligence and technology, Cedar<br />

Rose has won several awards including <strong>Credit</strong> Excellence<br />

& European Business Awards. Our website is a one-stopshop<br />

for your business intelligence solutions. We are the<br />

ultimate source; with competitive prices and friendly customer<br />

service - whether you need one or one thousand reports.<br />

Company Watch<br />

Centurion House, 37 Jewry Street,<br />

LONDON. EC3N 2ER<br />

T: +44 (0)20 7043 3300<br />

E: info@companywatch.net<br />

W: www.companywatch.net<br />

Organisations around the world rely on Company Watch’s industryleading<br />

financial analytics to drive their credit risk processes. Our<br />

financial risk modelling and ability to map medium to long-term risk as<br />

well as short-term credit risk set us apart from other credit reference<br />

agencies.<br />

Quality and rigour run through everything we do, from our unique<br />

method of assessing corporate financial health via our H-Score®, to<br />

developing analytics on our customers’ in-house data.<br />

With the H-Score® predicting almost 90 percent of corporate<br />

insolvencies in advance, it is the risk management tool of choice,<br />

providing actionable intelligence in an uncertain world.<br />



T: +31 (0)88 256 66 66<br />

E: ruurd.bakker@onguard.com<br />

W: www.onguard.com<br />

Onguard is specialist in credit management software and market<br />

leader in innovative solutions for order to cash. Our integrated<br />

platform ensures an optimal connection of all processes in the order<br />

to cash chain and allows sharing of critical data.<br />

Intelligent tools that can seamlessly be interconnected and offer<br />

overview and control of the payment process, as well as contribute to<br />

a sustainable customer relationship.<br />

In more than 50 countries the Onguard platform is successfully used<br />

for successful credit management.<br />

Credica Ltd<br />

Building 168, Maxell Avenue, Harwell Oxford, Oxon. OX11 0QT<br />

T: 01235 856400E: info@credica.co.uk W: www.credica.co.uk<br />

Our highly configurable and extremely cost effective Collections and<br />

Query <strong>Management</strong> System has been designed with 3 goals in mind:<br />

• To improve your cashflow • To reduce your cost to collect<br />

• To provide meaningful analysis of your business<br />

Evolving over 15 years and driven by the input of 1000s of <strong>Credit</strong><br />

Professionals across the UK and Europe, our system is successfully<br />

providing significant and measurable benefits for our diverse portfolio<br />

of clients.<br />

We would love to hear from you if you feel you would benefit from our<br />

‘no nonsense’ and human approach to computer software.<br />

Data Interconnect Ltd<br />

Units 45-50<br />

Shrivenham Hundred Business Park<br />

Majors Road, Watchfield<br />

Swindon, SN6 8TZ<br />

T: +44 (0)1367 245777<br />

E: sales@datainterconnect.co.uk<br />

W: www.datainterconnect.com<br />

Data Interconnect provides Intelligent Invoice to Cash Automation.<br />

Corrivo Billing, Collection and Dispute modules seamlessly integrate<br />

for a rich, end-to-end A/R user experience. Branded customer<br />

portals, real-time dashboards, advanced reporting, available in 15<br />

languages as standard; are some of the reason why global brands<br />

choose Data Interconnect.<br />

HighRadius<br />

T: +44 7399 406889<br />

E: gwyn.roberts@highradius.com<br />

W: www.highradius.com<br />

HighRadius is the leading provider of Integrated Receivables<br />

solutions for automating receivables and payment functions such<br />

as credit, collections, cash allocation, deductions and eBilling.<br />

The Integrated Receivables suite is delivered as a software-as-aservice<br />

(SaaS). HighRadius also offers SAP-certified Accelerators<br />

for SAP S/4HANA Finance Receivables <strong>Management</strong>, enabling<br />

large enterprises to maximize the value of their SAP investments.<br />

HighRadius Integrated Receivables solutions have a proven track<br />

record of reducing days sales outstanding (DSO), bad-debt and<br />

increasing operation efficiency, enabling companies to achieve an<br />

ROI in less than a year.<br />

Advancing the credit profession / www.cicm.com / <strong>June</strong> <strong>2020</strong> / PAGE 53 continues on page 54 >

Cr£ditWho?<br />

CICM Directory of Services<br />



russell@cabbells.uk 0203 603 7937<br />




ESKER<br />

Sam Townsend Head of Marketing<br />

Northern Europe Esker Ltd.<br />

T: +44 (0)1332 548176 M: +44 (0)791 2772 302<br />

W: www.esker.co.uk LinkedIn: Esker – Northern Europe<br />

Twitter: @EskerNEurope Esker.blog<br />

Esker’s Accounts Receivable (AR) solution removes the all-toocommon<br />

obstacles preventing today’s businesses from collecting<br />

receivables in a timely manner. From invoice delivery to cash<br />

application, Esker automates each step. Esker's automated AR<br />

system powered by TermSync helps companies modernise without<br />

replacing their core billing and collections processes. By simply<br />

automating what should be automated, customers get the post-sale<br />

experience they deserve and your team gets the tools they need.<br />

C2FO<br />

C2FO Ltd<br />

105 Victoria Steet<br />

SW1E 6QT<br />

T: 07799 692193<br />

E: anna.donadelli@c2fo.com<br />

W: www.c2fo.com<br />

C2FO turns receivables into cashflow and payables into income,<br />

uniquely connecting buyers and suppliers to allow discounts in<br />

exchange for early payment of approved invoices. Suppliers access<br />

additional liquidity sources by accelerating payments from buyers<br />

when required in just two clicks, at a rate that works for them.<br />

Buyers, often corporates with global supply chains, benefit from the<br />

C2FO solution by improving gross margin while strengthening the<br />

financial health of supply chains through ethical business practices.<br />

Menzies<br />

T: +44 (0)2073 875 868 - London<br />

T: +44 (0)2920 495 444 - Cardiff<br />

W: menzies.co.uk/creditor-services<br />

Operating across seven UK offices, Menzies LLP is an accountancy<br />

firm delivering traditional services combined with strategic<br />

commercial thinking. Our services include: advisory, audit,<br />

corporate and personal tax, corporate finance, forensic accounting,<br />

outsourcing, wealth management and business recovery –<br />

the latter of which includes our specialist offering developed<br />

specifically for creditors. For more information on this, or to see<br />

how the Menzies <strong>Credit</strong>or Services team can assist you, please<br />

visit: www.menzies.co.uk/creditor-services. Bethan Evans, Partner<br />

and Head of Menzies <strong>Credit</strong>or Services, email: bevans@<br />

menzies.co.uk and phone: +44 (0)2920 447512<br />

LEGAL<br />


Serrala UK Ltd, 125 Wharfdale Road<br />

Winnersh Triangle, Wokingham<br />

Berkshire RG41 5RB<br />

E: r.hammons@serrala.com W: www.serrala.com<br />

T +44 118 207 0450 M +44 7788 564722<br />

Serrala optimizes the Universe of Payments for organisations seeking<br />

efficient cash visibility and secure financial processes. As an SAP<br />

Partner, Serrala supports over 3,500 companies worldwide. With<br />

more than 30 years of experience and thousands of successful<br />

customer projects, including solutions for the entire order-tocash<br />

process, Serrala provides credit managers and receivables<br />

professionals with the solutions they need to successfully protect<br />

their business against credit risk exposure and bad debt loss.<br />

identeco – Business Support Toolkit<br />

Compass House, Waterside, Hanbury Road, Bromsgrove,<br />

Worcestershire B60 4FD<br />

Telephone: 01527 549 531 Email: info@identeco.co.uk<br />

Web: www.identeco.co.uk<br />

identeco’s Business Support Toolkit is an online portal connecting<br />

its subscribers to a range of business services that help them to<br />

engage with new prospects, understand their customers and<br />

mitigate risk. Annual subscription is £79.95 per year for unlimited<br />

access. Providing company information and financial reports,<br />

director and shareholder structures as well as a unique financial<br />

health rating, balance sheets, ratio analysis, and any detrimental<br />

data that might be associated with a company. Other services also<br />

included in the subscription include a business names database,<br />

acquisition targets, a data audit service as well as unlimited,<br />

bespoke marketing and telesales listings for any sector.<br />


Shoosmiths<br />

Email: paula.swain@shoosmiths.co.uk<br />

Tel: 03700 86 3000 W: www.shoosmiths.co.uk<br />

Shoosmiths’ highly experienced team will work closely with credit<br />

teams to recover commercial debts as quickly and cost effectively as<br />

possible. We have an in depth knowledge of all areas of debt recovery,<br />

including:<br />

• Pre-litigation services to effect early recovery and keep costs down<br />

• Litigation service<br />

• Post-litigation services including enforcement<br />

• Insolvency<br />

As a client of Shoosmiths, you will find us quick to relate to your goals,<br />

and adept at advising you on the most effective way of achieving them.<br />


Redwood Collections Ltd<br />

0208 288 3555<br />

enquiry@redwoodcollections.com<br />

Airport House, Purley Way, Croydon, CR0 0XZ<br />

“Redwood Collections offers a complete portfolio of debt collection<br />

services ranging from sensitive client-debtor mediation through to<br />

legal and insolvency action.<br />

Incorporated in 2009, we are pleased to represent in excess of<br />

11,000 clients. Whatever your debt collection needs, we have the<br />

expertise and resources to deliver a fast, efficient and cost-effective<br />

solution.”<br />


Dun & Bradstreet<br />

Marlow International, Parkway Marlow<br />

Buckinghamshire SL7 1AJ<br />

Telephone: (0800) 001-234 Website: www.dnb.co.uk<br />

Dun & Bradstreet Finance Solutions enable modern finance<br />

leaders and credit professionals to improve business performance<br />

through more effective risk management, identification of growth<br />

opportunities, and better integration of data and insights across the<br />

business. Powered by our Data Cloud, our solutions provide access<br />

to the world’s most comprehensive commercial data and insights<br />

- supplying a continually updated view of business relationships<br />

that helps finance and credit teams stay ahead of market shifts and<br />

customer changes. Learn more here:<br />

www.dnb.co.uk/modernfinance<br />

Gravity Global<br />

Floor 6/7, Gravity Global, 69 Wilson St, London, EC2A 2BB<br />

T: +44(0)207 330 8888. E: sfeast@gravityglobal.com<br />

W: www.gravityglobal.com<br />

Gravity is an award winning full service PR and advertising<br />

business that is regularly benchmarked as being one of the best<br />

in its field. It has a particular expertise in the credit sector, building<br />

long-term relationships with some of the industry’s best-known<br />

brands working on often challenging briefs. As the partner agency for<br />

the <strong>Credit</strong> Services Association (CSA) for the past 22 years, and the<br />

Chartered Institute of <strong>Credit</strong> <strong>Management</strong> since 2006, it understands<br />

the key issues affecting the credit industry and what works and what<br />

doesn’t in supporting its clients in the media and beyond.<br />

FORUMS<br />


T: +44 (0)1246 555055<br />

E: info@forumsinternational.co.uk<br />

W: www.forumsinternational.co.uk<br />

Forums International Ltd have been running <strong>Credit</strong> and Industry<br />

Forums since 1991. We cover a range of industry sectors and<br />

International trading, attendance is for <strong>Credit</strong> Professionals of all<br />

levels. Our forums are not just meetings but communities which<br />

aim to prepare our members for the challenges ahead. Attending<br />

for the first time is free for you to gauge the benefits and meet the<br />

members and we only have pre-approved Partners, so you will never<br />

intentionally be sold to.<br />

Bottomline Technologies<br />

115 Chatham Street, Reading<br />

Berks RG1 7JX | UK<br />

T: 0870 081 8250 E: emea-info@bottomline.com<br />

W: www.bottomline.com/uk<br />

Bottomline Technologies (NASDAQ: EPAY) helps businesses<br />

pay and get paid. Businesses and banks rely on Bottomline for<br />

domestic and international payments, effective cash management<br />

tools, automated workflows for payment processing and bill<br />

review and state of the art fraud detection, behavioural analytics<br />

and regulatory compliance. Businesses around the world depend<br />

on Bottomline solutions to help them pay and get paid, including<br />

some of the world’s largest systemic banks, private and publicly<br />

traded companies and Insurers. Every day, we help our customers<br />

by making complex business payments simple, secure and seamless.<br />

American Express<br />

76 Buckingham Palace Road,<br />

London. SW1W 9TQ<br />

T: +44 (0)1273 696933<br />

W: www.americanexpress.com<br />

American Express is working in partnership with the CICM and is<br />

a globally recognised provider of payment solutions to businesses.<br />

Specialising in providing flexible collection capabilities to drive a<br />

number of company objectives including:<br />

•Accelerate cashflow •Improved DSO •Reduce risk<br />

•Offer extended terms to customers<br />

•Provide an additional line of bank independent credit to drive<br />

growth •Create competitive advantage with your customers<br />

As experts in the field of payments and with a global reach,<br />

American Express is working with credit managers to drive growth<br />

within businesses of all sectors. By creating an additional lever to<br />

help support supplier/client relationships American Express is proud<br />

to be an innovator in the business payments space.<br />

Advancing the credit profession / www.cicm.com / <strong>June</strong> <strong>2020</strong> / PAGE 54




Key IVR<br />

T: +44 (0) 1302 513 000<br />

E: sales@keyivr.com<br />

W: www.keyivr.com<br />

Key IVR are proud to have joined the Chartered Institute of <strong>Credit</strong><br />

<strong>Management</strong>’s Corporate partnership scheme. The CICM is a<br />

recognised and trusted professional entity within credit management<br />

and a perfect partner for Key IVR. We are delighted to be providing<br />

our services to the CICM to assist with their membership collection<br />

activities. Key IVR provides a suite of products to assist companies<br />

across the globe with credit management. Our service is based<br />

around giving the end-user the means to make a payment when and<br />

how they choose. Using automated collection methods, such as a<br />

secure telephone payment line (IVR), web and SMS allows companies<br />

to free up valuable staff time away from typical debt collection.<br />


Hays <strong>Credit</strong> <strong>Management</strong><br />

107 Cheapside, London, EC2V 6DN<br />

T: 07834 260029<br />

E: karen.young@hays.com<br />

W: www.hays.co.uk/creditcontrol<br />

Hays <strong>Credit</strong> <strong>Management</strong> is working in partnership with the CICM<br />

and specialise in placing experts into credit control jobs and credit<br />

management jobs. Hays understands the demands of this challenging<br />

environment and the skills required to thrive within it. Whatever<br />

your needs, we have temporary, permanent and contract based<br />

opportunities to find your ideal role. Our candidate registration process<br />

is unrivalled, including face-to-face screening interviews and a credit<br />

control skills test developed exclusively for Hays by the CICM. We offer<br />

CICM members a priority service and can provide advice across a wide<br />

spectrum of job search and recruitment issues.<br />



Portfolio <strong>Credit</strong> Control<br />

1 Finsbury Square, London. EC2A 1AE<br />

T: 0207 650 3199<br />

E: recruitment@portfoliocreditcontrol.com<br />

W: www.portfoliocreditcontrol.com<br />

Portfolio <strong>Credit</strong> Control, solely specialises in the recruitment of<br />

permanent, temporary and contract <strong>Credit</strong> Control, Accounts<br />

Receivable and Collections staff. Part of an award winning recruiter<br />

we speak to and meet credit controllers all day everyday understanding<br />

their skills and backgrounds to provide you with tried and tested credit<br />

control professionals. We have achieved enormous growth because we<br />

offer a uniquely specialist approach to our clients, with a commitment<br />

to service delivery that exceeds your expectations every single time.<br />

CICMQ accreditation is a proven model<br />

that has consistently delivered dramatic<br />

improvements in cashflow and efficiency<br />

CICMQ is the hallmark of industry<br />

leading organisations<br />

The CICM Best Practice Network is where<br />

CICMQ accredited organisations come<br />

together to develop, share and celebrate<br />

best practice in credit and collections<br />



To find out more about flexible options<br />

to gain CICMQ accreditation<br />

E: cicmq@cicm.com T: 01780 722900<br />

Advancing the credit profession / www.cicm.com / <strong>June</strong> <strong>2020</strong> / PAGE 55

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