Czech Republic: trade credit slashed during pandemic

Payment Practices Barometer

  • Czech Republic
  • Agriculture,
  • Electronics/ICT,
  • Food,
  • Metals,
  • Services,
  • Steel

25th November 2020

Prior to the pandemic, trade credit was used in more than 80% of B2B sales in the Czech Republic. After the virus brought most of the world to a standstill, this plummeted to about 50%.

Introduction

The Czech Republic’s export-to-GDP ratio is one of the highest in Europe. Although rising  inflation had caused some recent interest rate increases, prior to 2020 the country had been enjoying robust growth. When the COVID-19 pandemic struck, the economy was  already facing some external headwinds. This was largely caused by heavy dependence on international value chains and a vulnerability to a slowdown in the EU, its main export destination.

This year’s Payment Practices Barometer survey was conducted during the COVID-19  pandemic and provides valuable insight into how businesses of all sizes and sectors throughout the Czech Republic are coping with the sudden economic downturn.

Key takeaways from the report

  • Amount of overdue invoices surges during the pandemic
  • SMEs with a poor credit record increasingly refused credit by suppliers
  • Czech Republic experiences rapid drop in credit sales
  • Supplier cash flow hit hard in COVID-19 economic crisis
  • Majority of businesses concerned about falling demand for products and services in 2021

Interested in getting to know more?

For a complete overview of the corporate payment behaviour in the Czech Republic during the COVID-19 pandemic and global recession, please download the complete report. The report gives also insight into the impact of the pandemic-induced economic crisis on the following industries in the country:

  • Agri-food
  • Chemicals
  • Electronics
  • Steel -metals
  • Services

All content on this page is subject to our Disclaimer, available here.

 

 

Disclaimer

Each publication available on or from our websites, such as, but not limited to webpages, reports, articles, publications, tips and helpful content, trading briefs, infographics, videos (each a “Publication”) is provided for information purposes only and is not intended as a recommendation or advice as to particular transactions, investments or strategies in any way to any reader. Readers must make their own independent decisions, commercial or otherwise, regarding the information provided. While we have made every attempt to ensure that the information contained in any Publication has been obtained from reliable sources, Atradius is not responsible for any errors or omissions, or for the results obtained from the use of this information. All information in any Publication is provided ’as is’, with no guarantee of completeness, accuracy, timeliness or of the results obtained from its use, and without warranty of any kind, express or implied. In no event will Atradius, its related partnerships or corporations, or the partners, agents or employees thereof, be liable to you or anyone else for any decision made or action taken in reliance on the information in any Publication, or for any loss of opportunity, loss of profit, loss of production, loss of business or indirect losses, special or similar damages of any kind, even if advised of the possibility of such losses or damages.