Belgium: heightened insolvency risk clouds outlook

Payment Practices Barometer

  • Belgium
  • Agriculture,
  • Construction,
  • Consumer Durables,
  • Food

24th November 2021

In response to deteriorating payments behaviour over the coming months, businesses polled across Belgium focus on taking steps to protect their business from the impacts of customer credit risk.


Belgium’s Payment Practices Barometer survey revealed some interesting results. Primary among these is the huge volume of businesses across the country that anticipate growth next year. 86% of the businesses we surveyed reported a positive outlook, closely tracking economic predictions that forecast a post-crisis recovery that will gather pace, reaching pre-pandemic levels of GDP by mid-2022. However, as the government fiscal support measures is phased out, it will cause a return to normal insolvency levels on top of the likely insolvency of any business that has struggled over the past year or so and only survived due to the government support. The main message here is businesses should be alert to the risk of heightened insolvency, particularly in H1 of 2022, as this could cloud the country's positive growth outlook.

Key takeaways from the report

  • 51% of the total value of Belgian survey respondents' B2B sales this year were reported overdue. This compares to last year’s 47%. Write-offs amounted to 9%, compared to last year's 8%.
  • When it comes to credit management, businesses polled across Belgium most often opted to retain and manage customer credit risk internally this year. This by setting aside funds to offset potential credit losses caused by bad debts.
  • However, for a significant number of businesses have opted for self-insurance, reliance on their own credit management resources proved be costly, as they incurred increased administrative and trade debt collections costs. Additionally, 62% told us they were not able to contain DSO and experienced year-on-year deterioration of cash flow.
  • To have sufficient liquidity to meet their short-term payment obligations, many businesses polled delayed payments to their own suppliers as well as investments in their business growth.
  • Looking into 2022, the vast majority of the businesses we spoke to across Belgium (86%) expressed optimism about their growth outlook. Businesses polled in the construction materials industry reported an increased interest in trade credit insurance.
  • However, businesses are aware that downside risks remain. The largest being the risk of the pandemic continuing to affect the global economy and domestic economies, delaying or even  hampering a rebound.
  • When asked which pandemic-induced changes will become a permanent feature of the way they do business, 61% of businesses told us increased digitalisation, 51% said remote
    working. Increased ecommerce and adaptation to changes in customer demand were also commonly cited.

Interested in getting to know more?

The Payment Practices Barometer report for Belgium gives insights into B2B payment practices and businesses' approach to the management of customer credit risk in the following local industries:

  • Agri-food
  • Consumer durables
  • Construction materials

For a complete overview, please download the full country report available in the Related documents section below. The Statistical Appendix and regional Payment Practices Barometer survey results are also available free to download.

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