Trade credit debt is almost as high as bank debt among people entering business related personal insolvency, the Australian Financial Security Authority reports.
AFSA found that in September, people in business who entered into a personal insolvency owed 35 per cent of their debts to banks and 32 per cent to businesses, sole traders or individuals.
The gap between the two sources of credit has narrowed this year.
AFSA said: This is significant because bank debt is frequently secured, whereas trade credit is often not, increasing the risks for businesses, sole traders or individuals who provide goods or services on credit.
Businesses and sole traders are just as exposed as banks, it said.
The most exposed businesses include profession…
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