As a global business serving customers across more than 100 countries, Vital Solutions understands that extending credit is often essential for growth. By combining strong internal credit controls with Coface Trade Credit Insurance, the company has added an important layer of protection against customer payment defaults, helping safeguard cash flow and support international expansion.
Operating across diverse international markets requires businesses to carefully balance growth opportunities with risk management. For Vital Solutions Pte. Ltd., a global distribution and supply chain management company specialising in the Pulp & Paper and Building Materials industries, extending credit to customers is a normal part of doing business.
To manage this exposure, Vital Solutions maintains robust internal processes to evaluate and monitor customer credit risk. However, as with any company engaged in international trade, customer payment defaults can still occur despite prudent risk management practices.
To strengthen its overall risk management framework, Vital Solutions relies on Coface Trade Credit Insurance as an additional line of defence. When customers covered under the policy defaulted, Coface compensated Vital Solutions for up to 90% of the insured claim value, helping protect cash flow, reduce financial losses and support continued business growth.
Beyond claims protection, the partnership with Coface has also strengthened confidence among financial institutions, supporting the company's access to trade financing and ability to pursue new opportunities in global markets.
The Story
Vital Solutions is a global distribution and supply chain management firm specialising in the Pulp & Paper and Building Materials industries. In international trade, offering credit terms is often necessary to remain competitive and support customer relationships. While these arrangements create opportunities for growth, they also expose businesses to the possibility of late payment and customer default.
To manage these risks, Vital Solutions has established internal processes to assess, select and monitor customer credit exposure. These controls form the foundation of the company's approach to risk management and play an important role in supporting sustainable growth across international markets.
Recognising that no credit management framework can completely eliminate the risk of payment default, Vital Solutions sought an additional layer of protection to complement its existing controls. This led the company to partner with Coface for Trade Credit Insurance.
Rather than replacing internal credit management practices, the insurance policy serves as an additional safeguard, helping protect the business when covered customer defaults occur.
An Additional Line of Defence Against Payment Defaults
Customer payment defaults are an inevitable reality of international trade. Even financially sound businesses can encounter difficulties arising from changing economic conditions, market disruptions, operational challenges or other unforeseen circumstances.
For Vital Solutions, Trade Credit Insurance provides valuable protection against these risks. When customers covered under the policy defaulted, Coface compensated the company for up to 90% of the insured claim value, helping minimise financial losses and protect working capital.
The protection has proven particularly valuable given the company's international footprint and exposure to customers across a wide range of markets.
"What stood out to us was how professionally Coface handled the claims process. In our experience, you only truly appreciate the value of an insurance partner when a claim arises, and Coface proved to be a reliable and dependable partner," said Krishnan Varadarajan, CEO, Vital Solutions.The company's experience demonstrates how trade credit insurance can complement existing credit controls by providing an additional layer of financial protection when covered customer defaults occur.
Supporting Financing and Business Growth
The value of trade credit insurance extends beyond claims protection.
For Vital Solutions, insured receivables can also provide greater assurance to financial institutions involved in supporting trade transactions.
"Many banks in Singapore take comfort in the fact that our receivables are insured and that we work with a reputable credit insurer like Coface. This gives them greater confidence to extend trade financing to support our transactions," explained Varadarajan.
This additional confidence can help businesses strengthen access to financing, improve cash flow management and support ongoing growth initiatives.
Enabling Global Expansion with Confidence
As businesses expand into new markets, they often face greater uncertainty when extending credit to customers across different regions and economic environments. Having appropriate risk mitigation measures in place can provide the confidence needed to pursue growth opportunities while managing exposure to non-payment risk.
For Vital Solutions, strong internal credit controls remain the first line of defence. Combined with the additional protection provided by Coface Trade Credit Insurance, the company has built a more resilient approach to managing trade receivables across its international operations.
"Our experience with Coface has been very positive," concluded Varadarajan. "Ultimately, it gives you peace of mind about your receivables and allows you to focus on growing your business. Based on our experience, I would have no hesitation recommending Coface to other businesses, especially those looking to expand internationally."
By complementing its existing risk management framework with Coface Trade Credit Insurance, Vital Solutions can continue pursuing opportunities across global markets with greater confidence, knowing it has an additional layer of protection when covered customer defaults occur.