Financial Risk

What is Financial Risk

Financial risk considers exposure from economic volatility, vendor insolvency, unstable funding models, or revenue dependence. In TPRM, financial risk assessments determine whether a vendor can sustain operations and meet long-term obligations.

FAQs

Why assess vendor financial risk?

To avoid service disruption from vendor instability.

What signals financial risk?

Poor liquidity, declining revenue, or high debt.

Do all vendors require financial review?

Critical vendors always do.