Coface, a world leader in credit insurance and also a credit management service provider, opened its Beijing office yesterday to develop the local corporate trade credit market.

It is the first foreign credit insurer to establish a representative office in Beijing.

Credit insurance is a special form of insurance, which covers the risk of non-payment by corporate buyers whether they are involved in export or domestic trade.

Coface Regional Managing Director for China Operations Richard Burton said there is immense scope for developing China's corporate trade credit market, which is believed to be essential to supporting continued economic growth.

"We are encouraged as we have observed encouraging signs, including keen interest by the authorities in business-to-business credit in China, and there is already fairly good credit information that can be enhanced and made more sophisticated," he said.

France-based Coface also signed an agreement with China Merchants Bank (CMB) to incorporate its web-based rating solutions into the bank's online platform.

By deploying rating solutions in its online platform, CMB is enabling its customers to check the credit worthiness of 44 million companies worldwide, which can help local companies to lower trading risks.

They can also demonstrate their own capability to pay, and can obtain more favourable payment terms by obtaining a Coface rating label.

Coface also took another important step by issuing China's first domestic credit insurance policy, with the co-operation of Ping An Property & Casualty Insurance Co.

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