The Rating* is a comprehensive evaluation about a company’s degree of solvency, and thus assesses its ability to generate sufficient resources to pay its creditors. The rating is assigned by specialist analysts and is supported by quantitative information and scores (i.e. an automatic evaluation of creditworthiness obtained via the use of a statistical model).

The rating methodology entails the use of all the information present in various information systems, in addition to basic information such as: company financial reports, general and corporate information, official negative events concerning the company and all parties connected with it, regularity of commercial transaction payments, historic and perspective sector scenarios and press reviews.

The rating models distinguish the above-mentioned information in two different areas of analysis:

  • Quantitative information, constantly updated at each relevant event, is processed through proprietary statistical grading systems that assess the economic-financial and behavioural risk profile of the company
  • The qualitative analysis performed by credit rating analysts, based on the examination of all the data and fundamental and behavioural evaluations elaborated by the statistical model, and also on the qualitative information acquired from a variety of sources

The analysis of the grading allows an initial assessment of the company's creditworthiness to be developed, which forms the basis on which, together with other information not considered in the score, the analyst expresses his own independent judgment, which may still vary significantly.

The modular model used in the valuation of credit rating is illustrated by the following diagram:

Payment habits

CrowdCity can also rely on a database that can monitor the payment habits of Italian small medium enterprises in real time. This database allows bad and good debtors to be distinguished based on their commercial habits.

Such databases are built on a base-community of over 30,000 suppliers (including main Italian utilities) that regularly collect data on their clients’ payment practices.

When it comes to managing payment extensions to clients, such informations can drive decisions by monitoring a company’s reliability in real time and providing detailed monthly statistics on payments, including timely and overdue collection trends and contractual and effective payment terms.

In order to include a comprehensive mix of evaluation criteria, this information is incorporated into a synthetic rating, allowing investors and brokers to make informed choices regarding their investment strategies.

*The ratings provided to CrowdCity are not public ratings covered by the current European legislation.