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.