What are Credit Put Options for Trade Credit?
Credit put options are an alternative risk management solution that publicly-traded companies and larger private companies use for protection against trade credit losses from insolvent customers.  UPS Trade Credit Protection Services offers credit put options in partnership with financial institutions for terms ranging from six months to three years in amounts covering $500 thousand to $100 million.  The business with credit put options can sell the receivables from a bankrupt customer back to the bank, receiving 100% coverage of the insolvency loss without a deductible or co-insurance.