Press release: Payment behaviour of companies in Estonia is in its best shape in years
Statistical data of Krediidiinfo AS for the first half of 2014 reveals that the payment behaviour of companies in Estonia is very good. The share of companies with debts is at its lowest in years: only 4.6% of active companies have tax arrears and only 3.3% have debts to their business partners.
During the last year the number of companies with tax arrears or debts to business partners has decreased by 34%. Of the total number of active companies 2,233 have debts to their business partners and 3,117 have tax arrears. The number of companies with both types of debts has decreased in all counties of Estonia, while Ida-Virumaa has most number of such companies: 6% of enterprises there have tax arrears and debts to their business partners.
Since credit risk of companies is influenced not only by financial information and the management’s background, but also – and significantly so – by payment behaviour issues, the number of companies with high credit risks is currently at the lowest level over the last seven years (9%). Hotel and catering sector remains among the ones with relatively high credit risk levels – here every fifth company may potentially develop large debts.
Over the last year the total amount of debts to business partners has decreased in virtually every sector – from 47 to 34 million euros, i.e. by 26.5%. More than half of these debts (17.9 million euros) are in the real estate sector, where the total amount of debts over the last year has decreased by 21.4%.
The total amount of tax arrears (debts to the state) has decreased from 49 to 25 million euros (by 50%). The largest tax arrears are in retail and wholesale sectors, but even here the total amount of debt has decreased by one third over the last year.
Over the years the most significant credit risks have been in the construction sector. Despite the fact that every 7th company in this sector may find itself in debt, over the year the amount of both types of debts has decreased by more than 60%.
Krediidiinfo statistics is based on the data for the first half of 2014 received from the Credit Register and the Estonian Tax and Customs Board. The sample consists of 67,674 active Estonian companies.