Supplier Credit and Credit Networks Step up to the Plate: The Role of Business Credit During Deteriorating Business Conditions. (Business Credit Selected Topic).

Credit quality at many large corporate borrowers is eroding, according to recently published research from Moody's Investors Service, Fitch, Inc. and S&P, making it necessary for banks to prepare themselves against possible future defaults. Declines in corporate credit quality could also have a negative impact on the flow of capital from lenders to borrowers, putting pressure on suppliers of goods and services to figure out how to increase revenues to quality customers while preventing losses from their own distressed customers. This article addresses the ability of suppliers to step in and provide credit when banks reduce exposures during times of economic difficulty. ...