Asunción: Financial advisor Dr. Juan Carlos Zárate Lázaro gave some recommendations both for borrowers and for lenders by financial institutions in order to avoid the dreaded late payments in the sector.
One of the strategic axes in credit analysis and assessment is for financial institutions to have staff with the necessary capacity and experience in critically analyzing their clients’ key critical risk areas and being proactive in identifying potential problems that may arise.
Your company should not limit itself to disbursing short-term loans to finance working capital needs, but should also focus on medium and long-term loans, which also include SMEs, to implement the growth/expansion plans of your activities.
We must continue to develop and strengthen our economy and the economic and financial management of our enterprises, not only to meet the demand of the domestic market but also to pursue stronger growth abroad.
Financial institutions must strive to build trust in their customers and in the professional performance and character of their management.
It is difficult to avoid credit risk, as it occurs even in first world countries whose technological, human, macro- and microeconomic development levels are higher than those of Paraguay. In practice, zero risk does not exist.
Through assessment and monitoring mechanisms, financial institutions must adopt a proactive rather than reactive stance.
Consider the following aspects:
a) management factors; b) liquidity; c) industry; d) business; e) “sense of smell”.
Weekly News / The Nation FOCUS
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