Credit risk can be defined as the probability of loss resulting from a seller not being able to recover payment for goods supplied to an end-buyer, or the failure of a client to repay a financier. When a financier is assessing any form of credit facility, the probability of default and loss given default must be considered. The process of identifying and managing credit risk is described and how the credit assessment of a structured trade and receivables finance facility which requires an identifiable transactional source of repayment differs from conventional balance-sheet lending. The importance of the client remaining a going concern during the financed transaction is highlighted. Risk and reward is explored and how the alternative market financier’s approach differs from that of a commercial bank.