Security (sikkerhedsstillelse)

Also known as security, collateral, providing security, stille sikkerhed, garanti, depositum

Security is the collective term for whatever a debtor puts up to secure their debt — a charge, a guarantee, a bank guarantee or a deposit.

In practice

Security is what separates a risk from a loss. Without it you are an unsecured creditor, and unsecured creditors typically get nothing in a bankruptcy.

The decision belongs in the credit policy, not in the collections department: how much exposure do we accept without security, and at what point do we require it?

Where it commonly goes wrong

  • Asking for security only once the customer is in trouble. By then you will not get it — and if you do, it can be clawed back into the estate in a subsequent bankruptcy.
  • 30 days free
  • No payment card
  • One day's notice