PROVISION OF TRADE CREDIT UNDER THE CONDITIONS OF GLOBALIZATION

The existence of business entities is significantly affected by economic, political and social factors of the country. There probably is not a sector in which companies do not have smaller or bigger financial problems at the time of global economic difficulties. Offering trade credit is a strategic tool in the hands of the company. There are businesses that have a significant proportion of assets bound in receivables. A significant component of receivables is represented by trade receivables. Financial problems cause deterioration of customer's payment discipline that negatively affects the solvency of the business entity. Recent surveys have shown improvement of payment discipline of business entities. Nevertheless, the situation is not favourable. Business entities are subjected to credit risk. It is due to the fact that many receivables are paid after maturity date and some of them are not paid at all. Credit risk belongs to a group of financial risks. The risk faced by each entity that provides trade credit. The success or failure of the business entity depends on the ability to identify this risk and minimize it. Receivables management is one of the tools how to successfully reduce the emergence of bad debts in the company. In providing trade credit company emphasizes the careful selection of its business partners. The aim of this paper is to determine the optimal amount of short-term receivables on an individual company as well as the draft of the general credit risk rating model of the customer.