Credit Management Solutions for Companies Selling to Spain

Credit management is what prevents bad debts. Debt collection is what happens when credit management fails. For overseas companies selling to Spanish clients, the distinction matters more than in most markets because Spain's commercial payment culture creates risks that standard credit policies — designed for domestic or Northern European clients — don't adequately address.

Why Standard Credit Management Fails for Spanish Clients

Your domestic credit policy probably works well for clients who pay within 30–45 days, respond to payment reminders, and treat contractual payment terms as binding obligations. Spanish commercial clients operate differently. Average B2B payment terms in Spain routinely stretch to 60–90 days in practice, regardless of what the contract says. Ley 15/2010 mandates 30-day terms (60 days maximum by agreement), but compliance is inconsistent.

This doesn't mean Spanish clients are unreliable. It means your credit management framework needs to account for structurally longer payment cycles without losing the ability to distinguish between normal Spanish payment behaviour and genuine default signals.

Credit Assessment Tools for Spanish Companies

Registro Mercantil (Commercial Registry). Every Spanish company must file annual accounts and corporate information. The registry provides incorporation dates, director names, filed financials, and corporate structure. Access is public (with a small fee) and provides baseline verification that the company exists, is active, and has filed accounts. Missing or late filings are a warning sign.

Credit reporting services. Informa D&B, Axesor, and CESCE provide detailed credit reports on Spanish businesses, including payment behaviour scores, outstanding legal proceedings, financial ratios, and recommended credit limits. Cost: €20–€100 per report. For any credit exposure above €25,000, a credit report is essential due diligence.

ASNEF and RAI debtor registries. ASNEF (managed by Equifax) and RAI (Bank of Spain's risk registry) indicate whether a company has outstanding defaults. Listing on either registry is a strong negative signal. Checking these registries before extending credit takes minutes and costs little.

Trade references. Ask your Spanish prospect for references from other international suppliers. A company that pays domestic vendors on time but delays international invoices will show a pattern. If they refuse to provide international references, that's informative.

Contract Terms That Protect You in Spain

Written payment terms with interest provisions. Specify exact payment dates, reference Ley 15/2010 for statutory late payment interest, and include a clear statement of consequences for non-payment. Spanish courts enforce written contractual terms — verbal agreements are difficult to prove and even harder to enforce.

Retention of title (reserva de dominio). For goods supplied to Spanish companies, this clause means the goods remain your legal property until paid for. Most effective when properly documented and when the goods are identifiable — equipment and finished products benefit more than raw materials.

Milestone payments for large contracts. A 30/30/40 payment structure (advance/delivery/acceptance) limits your maximum exposure to 40% of the contract value at any point. Standard practice in Spanish construction, engineering, and technology contracts.

Jurisdiction clauses. Specify which courts have jurisdiction in case of disputes. For overseas creditors, Spanish jurisdiction is often preferable because it aligns enforcement capability with the debtor's location and assets.

Monitoring and Early Warning

Credit management doesn't end when the contract is signed. Ongoing monitoring catches deterioration before it becomes a default:

Payment pattern changes — a client who paid in 40 days now taking 70 is showing stress. Requests to extend payment terms mid-contract. Late filing of annual accounts at the Registro Mercantil. Appearance on debtor registries. Management changes or restructuring announcements. Reduction in order volume (they may be shifting to suppliers they owe less).

Any two of these signals in combination warrant a proactive conversation about the account's risk profile.

FAQ

Should I require advance payment from all new Spanish clients?

For initial orders, a partial advance (30–50%) is reasonable and widely accepted. For established relationships with good payment history, moving to standard credit terms is appropriate but should be supported by ongoing credit monitoring. The key is calibrating terms to the specific client's risk profile rather than applying a blanket policy.

Is credit insurance worth it for Spanish receivables?

For companies with annual Spanish receivables exceeding €500,000 and multiple Spanish clients, credit insurance through Coface, Euler Hermes, or CESCE can be cost-effective. For smaller portfolios, the premium may exceed the expected loss. The decision depends on client concentration and your risk appetite.