Freight forwarders have been urged to strengthen their credit risk management as global trade faces growing volatility.

Transport and logistics insurer TT Club is highlighting a surge in freight crime and cargo abandonment, driven by ongoing market instability. This turbulence is exposing freight forwarders to unprecedented credit risk.

Mike Yarwood, TT Club’s managing director of loss prevention, said: : “Freight forwarders work right at the intersection of global trade and local business, their role in coordinating shipments, managing customs and delivering goods promptly makes them indispensable to SMEs. However, this proximity also makes them vulnerable when clients default.

“As SMEs falter under financial pressure, due to things like the marked increase in tariff activity across multiple jurisdictions, forwarders face delayed payments, abandoned cargo and the potential for client insolvency. The result is a heightened exposure to credit risk – an area traditionally under-appreciated in logistics operations.”

TT Club advises that freight forwarders act now to avoid major credit losses by strengthening contracts, conducting thorough credit assessments, and monitoring both macroeconomic trends and sector-specific risks. The insurer also stressed the importance of robust legal liability insurance as a safety net.

Yarwood added: “The global economic landscape is unlikely to stabilise soon, so freight forwarders must be prepared for their customers to default. There are clear steps to help them weather the storm, but they must be taken urgently.”

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