Debenhams has insisted it is in a “healthy” financial position despite suffering a cut to its credit insurance.
According to The Sunday Times, top credit insurer Euler Hermes and Coface have both reduced cover for suppliers to the department store chain.
The changes apply to new business, with existing supplier contracts thought to be unaffected.
It marks the latest setback in a year that has already seen Debenhams issue three profit warnings.
In its most recent update to the City last month, Debenhams blamed “increased competitor discounting and weakness in key markets” for its reduced profit forecast.
A Debenhams spokesman insisted the business had a “healthy balance sheet and cash position”.
He added: “All the credit insurers continue to provide cover to our suppliers and we maintain a constructive relationship with them. It is well-documented that market conditions are challenging, but Debenhams continues to be profitable, has a clear strategy in place and is taking decisive actions to strengthen the business.”