How to Deal with SINOSURE as an Importer

When engaging in international trade, especially when importing goods from China, businesses often encounter various challenges. These may include issues such as cash flow constraints and lengthy shipping times. One potential solution to address these challenges is negotiating deferred payments with suppliers, allowing payment after the goods are shipped. However, convincing suppliers to agree to deferred payments can be a hurdle. In China, for instance, a helpful approach is to engage with Sinosure, the China Export & Credit Insurance Corporation. Sinosure plays a key role in insuring trade transactions involving Chinese companies. So, let's explore a guide on how to deal with Sinosure effectively.

Sinosure acts as a bridge between exporters and importers, offering insurance and financial services to mitigate risks associated with cross-border transactions. Its primary goal is to promote international trade by providing credit insurance, export financing, and related services.

Sinosure, as a prominent export credit insurance company in China, offers a structured process for facilitating contracts between exporters and importers. Here is a typical workflow for dealing with Sinosure and Chinese suppliers.

1. Initial Discussion with Chinese Partner:
Importers start the process by discussing with their Chinese partners whether they have a valid Sinosure insurance policy or are open to acquiring one. Note that only Chinese enterprises can obtain a Sinosure policy, so clear communication is crucial for a smooth collaboration on installment terms.

2. Supplier Applies for Sinosure Insurance:
The supplier takes the lead by applying for a Sinosure insurance policy, if not done previously, and expresses their intent to sign a contract with the specific importer on deferred payment terms.

3. Importer Undergoes Sinosure Investigation:
Importers undergo a thorough Sinosure investigation, evaluating factors like credit history, financial reporting data, and past trading volumes with China. This step typically takes 21-30 days.

4. Sinosure Establishes Credit Rating for Importer:
Within the specified timeframe, Sinosure establishes a credit rating and credit limit for the importer, applicable to transactions with one or multiple suppliers.

5. Contract Revision and Deferred Payment Schedule:
Importers and suppliers revise their contract to incorporate updated terms, including the deferred payment schedule, insured by Sinosure. Commonly, a 90-120-day payment deferment is established.

6. Supplier Registers Contract with Sinosure:
The supplier formalizes the agreement by registering the contract with Sinosure and securing insurance for the invoice, adding an additional layer of protection to the transaction.

7. Importer Makes Advance Payment:
To initiate the manufacturing and shipping process, the importer makes an advance payment to the supplier, typically comprising 20-30% of the invoice.

8. Goods Manufacturing and Shipment:
With the initial payment secured, the supplier proceeds with manufacturing and shipping the goods according to the agreed-upon terms.

9. Importer Receives Goods and Completes Payment:
Upon receiving the goods, the importer fulfills the remaining payment to the supplier, adhering to the confirmed deferral period of 90-120 days.

By following this step-by-step guide provided for dealing with Sinosure, businesses can navigate the export credit process seamlessly and foster secure trade relationships with Chinese exporters.