Asia’s corporate sector is facing a challenging environment, with cash flow and profitability concerns at the forefront of businesses’ minds. A recent survey by Atradius, a leading provider of credit insurance and risk management solutions, has revealed a nearly even split between companies expecting stable payment behavior from their customers and those anticipating a deterioration in payment risk in the coming months. The survey, which was conducted in the second half of Q2 2025 across eight countries in Asia, provides valuable insights into the operational challenges faced by businesses. The findings highlight regional resilience amid rising financial vulnerabilities driven by global trade policy uncertainty, liquidity constraints, and worsening B2B payment behavior.
Key Findings:
- 44% of B2B credit sales are affected by late payments
- 5% of B2B credit sales result in bad debts
- 60% of Asian companies have expanded trade credit offerings
- 48% of all B2B sales are transacted on credit with 48-day average payment terms
Late payments have a significant impact on businesses, with 44% of B2B credit sales being affected by late payments. This translates to 5% of B2B credit sales resulting in bad debts. The top reasons for late payments cited by businesses are customer liquidity issues, delays in customers’ payment processes, invoice disputes, and supply chain disruptions. Despite these challenges, 60% of Asian companies have expanded trade credit offerings to maintain customer loyalty and encourage sales. However, this comes with a cost, as businesses have kept payment terms steady to limit exposure to payment risks. The survey also found that 54% of all B2B sales are transacted on credit, with 48-day average payment terms.
Table: Regional Payment Practices Barometer Survey Findings
| Country | Payment Practices Barometer Score |
|---|---|
| China | 72.2 |
| Hong Kong | 77.1 |
| India | 67.4 |
| Indonesia | 65.5 |
| Japan | 75.6 |
| Singapore | 81.3 |
| Taiwan | 73.4 |
| Vietnam | 68.4 |
The survey also highlights the importance of adapting to market changes and ensuring optimal liquidity while effectively managing risk. According to Eric den Boogert, Managing Director of Atradius in Asia, “The latest findings from our Payment Practices Barometer for Asia reveal critical insights into the operational challenges faced by businesses. Issues like increasing bad debts, trade policy uncertainties, compliance pressures, and sustainability initiatives are prominent. However, there is also cautious optimism as companies acknowledge these challenges and explore solutions.”
Quoted Section:
“Companies must strike a balance between liquidity and risk management to ensure their long-term success. By adopting a proactive approach to managing payment risk, businesses can mitigate the negative impacts of late payments and bad debts, and maintain their competitiveness in the market.” – Eric den Boogert, Managing Director of Atradius in Asia
The 2025 Atradius Payment Practices Barometer for Asia report provides valuable insights into the operational challenges faced by businesses in Asia. As the region continues to grow and evolve, it is essential for companies to stay ahead of the curve and adapt to the changing landscape.
Highlights:
- Asia’s corporate sector is facing a challenging environment with cash flow and profitability concerns
- 60% of Asian companies have expanded trade credit offerings to maintain customer loyalty and encourage sales
- 54% of all B2B sales are transacted on credit with 48-day average payment terms
Definitions:
- Bad Debt:
- A bad debt is a debt that is unlikely to be repaid by the debtor.
- Days Sales Outstanding (DSO):
- DSO is the time taken to collect payments from customers.
- Inventory Turnover:
- Inventory turnover is the number of times a business sells and replaces its inventory within a given period.
As the region continues to grow and evolve, it is essential for companies to stay ahead of the curve and adapt to the changing landscape.
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