How Risky Are Your Customers?

Q: What does the Portfolio Risk Benchmarking Report measure?

This report measures four key risk dimensions: Default risk – CreditorWatch’s RiskScore credit rating indicates an entity’s creditworthiness and predicts its likelihood of default in the next 12 months. Geographic risk – Our Geographic Risk Index/geo-risk metric measures future insolvency risk for 330 regions across Australia, ranking each region from best to worst in terms of potential for businesses in the region to become insolvent. Business maturity – The age of business is a significant structural driver of default risk. Default rates remain high for businesses less than five years old, with peak default rates occurring between years two and three. Business type – Type of business entity based on criteria such as private, public, sole trader, GST registration status etc.

Detailed risk assessments

How Risky Are Your Customers?

Our free Portfolio Risk Benchmarking Report will tell you

Financial Health Insights

Portfolio Risk Benchmarking Report

Understand a company's financial risk

Without the power of data, accurately measuring the risk of your customer base is pretty much impossible.

You need insights like how they’re paying other customers, the risks in their region and how long they’ve been operating.

Our free report clearly shows how risky your customers are compared to the national average. The report covers four key risk dimensions:

Credit Ratings (CreditorWatch RiskScore) – creditworthiness of entities in your portfolio
Geographic Risk – risk related to the location of your customers.
Business Maturity – how long your customers have been registered businesses.
Business Type – based on criteria such as private/public/sole trader/GST registration status.

In-Depth Customer Financial Reports

Financial Reporting

Tailored analysis of your customers

What is the CreditorWatch Portfolio Risk Benchmarking Report?

This report is a short-form risk driver analysis which provides a view of your customer base compared to the national average. It benchmarks lending or credit portfolios against comparable organisations.

This report reveals the creditworthiness of entities in your portfolio, risks related to their locations, how long your customers have been registered businesses, and the types of business entities you’re working with.

Essential tool for finance and credit managers

Why should I request a Portfolio Risk Benchmarking Report?

We use more than 50 public and private sources to provide the most accurate and predictive risk score in Australia. Our data sources include the ATO, ASIC and Australian Courts as well as more than 11 million trade lines from Xero, MYOB and corporate ATBs.

The insights from our Portfolio Risk Benchmarking Report, will help you make more informed decisions about who you’re doing business with, protect your cash flow and avoid bad debt.

Protecting Your Business

FAQS

Frequently asked
questions

The Portfolio Risk Benchmarking Report is a critical tool for businesses looking to better understand how their customer portfolio credit risk compares to others, and the steps they need to take to protect revenue and avoid payment defaults.

What does the Portfolio Risk Benchmarking Report measure?

This report measures four key risk dimensions:

Default risk – CreditorWatch’s RiskScore credit rating indicates an entity’s creditworthiness and predicts its likelihood of default in the next 12 months.
Geographic risk – Our Geographic Risk Index/geo-risk metric measures future insolvency risk for 330 regions across Australia, ranking each region from best to worst in terms of potential for businesses in the region to become insolvent.
Business maturity – The age of business is a significant structural driver of default risk. Default rates remain high for businesses less than five years old, with peak default rates occurring between years two and three.
Business type – Type of business entity based on criteria such as private, public, sole trader, GST registration status etc.

Why should a business get a Portfolio Risk Benchmarking Report?

It helps businesses see how risky their portfolio is. It not only helps them understand the risk of their customers, but also their risk on aggregate compared to their competitors.

If a business has extended credit, whether in the form of trade credit or loans, this report will provide an understanding of the default risk of their portfolio in the future.

Another key benefit is being able to compare their risk profile to similar companies within their industry. For example, a non-bank lender would be able to see how their risk profile compares to other non-bank lenders across Australia. Similarly, large banks can compare themselves to other large banks and so on.

What is unique about CreditorWatch’s Portfolio Risk Benchmarking Report?

We are the only credit bureau providing a report like this. We understand the need for such reports as we already do this regularly for some of our biggest clients.

This is different to other reports on market data as it is a bespoke report focusing directly on the customer base of one particular business. While other benchmarking and industry data might tell you about a whole industry, state or region, ours focuses specifically on the customer base of an individual business.

Is the Portfolio Risk Benchmarking Report relevant to businesses in all industries?

This report is for commercial lenders and financiers, and businesses with a turnover of at least $250 million.

It is most relevant to those businesses as we require larger pools of data and larger pools of similar companies to extrapolate meaningful comparisons.

Does a business have to benchmark its entire portfolio, or can it just do a portion of it?

A business can choose to benchmark its entire customer portfolio or a representative sample of the portfolio.

The bigger the dataset, the better the results. However, if you’d prefer to use a smaller subset, you will still reap the benefits of this report.

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