How to Assess the Viability of International Customers

Look at the definition of reliability: it means being trustworthy and performing consistently well. Well, that’s a good place to start when you’re deciding whether you should work with an international customer.

How a customer pays their own suppliers is going to tell you a lot about how you can rely on them to pay on time. What types of things would indicate an international customer is a reliable payer?

Here’s a few indicators you’ll find in their business credit report:

• Consistently pays their suppliers on time (or within 5-10 days of the agreed payment terms) over the course of 12 months – or longer.
• Vast majority of outstanding bills were current in the last 12 months – with a small portion being past due.

Now let us look at some red flags you might see that would make you reconsider working with an international customer.

• The international customer’s business credit report shows that their payment track record has been unstable and erratic for the last 12 months, with the DBT (Days Beyond Terms) repeatedly spiking and dipping almost every month.
• The international customer’s business credit report shows that they’re taking nearly three times as long to pay their suppliers from the same period a year earlier.
• The international customer’s business credit report shows that in most months over the last 12 months, the number of outstanding bills that were 91+ days past due has been over 50%.

The reality is that late payments can also cost your finance team a lot of time and pull them away from focusing on more strategic projects. According to our Cost of Late Payments study, 86% of finance and accounting professionals said that up to 30% of their company’s monthly invoiced sales are typically paid late. That means a huge chunk of revenue is routinely being delayed, affecting how much cash is available to run the business month to month.

66% of respondents are waiting on up to $70,000 in overdue payments every single month. That’s a serious cash flow gap, especially painful for small or mid-sized companies that rely on regular income to pay their own bills.

With Creditsafe’s international credit reports, you’ll get access to verified trade payment data from thousands of global third-party businesses. These insights help you answer some important questions. Is this international customer likely to pay me on time? How much credit should I feel comfortable offering them?

It’s clear that you can’t just make an assumption when deciding to work with an international customer. Assumptions don’t pay the bills. Data is the best way to make your decisions.

One of the biggest challenges in international credit assessment is the availability and quality of the right data.

As Leighton explains: “The quality of a credit report you should expect for a hotdog vendor in New York City is going to be very different to a large corporation anywhere in the world. Filing laws vary drastically by country.”

That’s why Creditsafe offers a standardized international credit score model (A–E) across 200+ countries, so you’re comparing apples to apples, even when data structures differ. Our reports also clearly highlight where data may be limited, out of date, or unavailable, so there are no nasty surprises.

And if you're building a global credit policy? Leighton recommends classifying your customers by size and region. “I’d recommend the classification of customers into small, medium and large sizes, with separate policies for different regions. You can’t create one-size-fits-all rules when the data quality is so different country-to-country.”

When doing business across borders, currency choices can impact profitability fast. Exchange rates fluctuate daily. For instance, in countries like Argentina, the Argentine Peso (ARS) can experience large daily fluctuations due to economic instability, often moving as much as 2-5% in a single day. Similarly, in Turkey, the Turkish Lira (TRY) has seen dramatic daily shifts, particularly during times of political or economic uncertainty, with exchange rates moving 3-10% within a few days. Even stable currencies like the Euro (EUR) can fluctuate by 1-2% against the US Dollar (USD), affecting cross-border transactions.

Leighton explained that currency preference can even reveal red flags: “If you ask to be paid in USD and they insist on using their local currency, that’s worth questioning. Why don’t they want to deal in the world’s reserve currency?”

And if you’re dealing with China, for example, Leighton added, “You’ve got to use their social payment system. That means verifying a business's identification codes, like their social credit number, before any transaction.”

So, what’s the best approach?

• Your company’s local currency: This is likely to be easier for your accounting team, but it may turn off some international customers.
• International customer’s local currency: This is likely to be more appealing to an international customer, but it introduces foreign exchange (FX) risk for you. For example, if you agree to receive payment in Brazilian Real (BRL), and the Real loses 10% of its value against the US Dollar between the time you make the deal and receive the payment, you’ll end up with less money than expected. This means your profit margin could shrink significantly. The risk here is that fluctuations in the value of your customer's currency can cause the final amount you receive to differ from what you originally anticipated, which could potentially lead to a loss.
• USD: This is often the safest and most widely accepted for international trade. The US Dollar remains the global reserve currency, and most businesses worldwide are familiar with its value and stability.

Whatever you choose, bake it into your credit policy and pricing strategy. And make sure you make your decisions based on what works best for your business.

Accepting credit card payments might seem like the quickest way to get paid. But for international deals, it’s often the riskiest.

“You’re not really in control of the relationship when a credit card is involved,” said Leighton. “There’s a chance of fraud, high transaction fees and the customer can always dispute the payment.”

Here’s what to watch for:

• Chargebacks and fraud
• High international transaction fees (especially with cards like Amex)
• Delayed dispute resolution

Instead, consider safer alternatives like letters of credit, especially for high-value or complex international deals. “Letters of credit transfer the responsibility to the bank. If the debtor doesn’t pay, the bank is liable,” Leighton explained.

One of the easiest ways to reduce international risk is to ensure you're dealing with the right company.

In 2024, 90% of U.S. companies experienced cyber fraud, with nearly half suffering losses exceeding $10 million, according to a report by Trustpair.

Leighton was clear: “Make sure you're collecting correct country-specific identifiers like tax IDs, registration numbers, VAT IDs, or LEIs. That's your form of recourse if something goes wrong.”

Using local identifiers ensures:

·       You're validating the real legal entity

·       You can trace back any fraud or payment disputes

·       You meet regional compliance requirements

What identifiers should you be cautious of?

Be careful when relying on identifiers that are easily accessible or commonly used, but not officially verified. Fraudsters often exploit publicly available information to create convincing fraudulent identities. Always cross-reference identifiers with official government databases or trusted third-party services.

Setting tailored credit control procedures for your international customers is essential. Without them, your business could face delayed payments, unexpected risks, or non-payment, all of which could jeopardize your cash flow. By establishing a structured approach, you’re better prepared to manage these challenges.

For instance, 31% of suppliers require a partial deposit of 30–60% before proceeding with an order. This practice ensures that both parties are committed to the transaction, offering a level of financial security upfront. Understanding such common terms helps you make informed decisions when negotiating payment plans with international customers.

What do smart credit control procedures look like?
Effective credit control involves assessing your customer’s creditworthiness, defining clear payment terms and creating contingency plans for late payments. With international customers, being aware of regional differences in payment terms can help you build strong, flexible and secure credit policies.

Why are these procedures important and how will they help when working with international customers?
Tailored credit control procedures help reduce the risk of late payments, protect your cash flow and ensure smoother operations when working with international clients. They also foster better business relationships by setting clear expectations from the start.

With Creditsafe, you gain the tools to support these procedures:

• Standardized credit scores for easy comparison across countries
• UBO (Ultimate Beneficial Owner) and group structure data
• Real-time monitoring and alerts when your customer’s risk changes

International customers offer huge growth potential, but they also introduce complex risks.

By analyzing payment data, researching market conditions, collecting the right identifiers, agreeing on currency terms and implementing smart credit procedures, your business can trade internationally with confidence.