Cash And Trade Magazine For Cash and Trade professionals in the Middle East
Coface Emirates Services, a subsidiary of the French Credit Insurance group Coface, multiplied its activities during the first part of 2012 and eyes more local SME’s to support their development through a debt protection Insurance.
The Trade Credit Insurance (TCI) provided by Coface is a receivables management solution which facilitates Business to Business Trade by covering the losses generated by the non-payment of a trade debt. It covers many of the commercial and political risks faced by a business when selling goods in domestic markets, export markets or both. All Emirati companies selling goods or services on credit terms of up to 180 days are concerned, whether SMEs or Corporates ( insurable Annual Turnover starts at 10 Million Aed).
According to Gregory Le Henand, Regional Business Development Manager of Coface Emirates Services “The UAE has become the hub of the Middle East and Africa Region, with 75% of Fortune 500 companies establishing their regional HQ in the country. In 2011, 78% of the UAE GDP has been exported to the Middle East, Africa and Asia region, mainly through Emirati SMEs. It is therefore crucial for the development of the economy to support this effort through the trade instrument that constitutes TCI”.
Mr. Le Henand added that TCI also constitutes a great financing opportunity for local businesses: “it’s challenging for Emirati SME’s to obtain loans or other forms of financing from local banks, who have to deal with devaluated assets carried over from the real estate bubble, the ongoing financial crisis and the higher capital requirements of the Basel 3 regulations.”
In this context of financing shortages, Coface Emirates developed several partnerships with local banks through the GCC: Emirates NBD, Commercial Bank of Dubai, Mashreq Bank, National Bank of Fujairah. These major lenders of the UAE economy partner with Coface to offer a financing solution to companies having credit insurance.
In the UAE, the Trade Credit Insurance (TCI) is available through Coface local insurance partners NGI and Oman Insurance. Mr Lehenand added that for the GCC region, Coface is headquartered in Dubai and also offers credit insurance through its partners in Saudi Arabia, Jordan, Bahrain and Oman.
Coface guarantees over 450 Billion USD of customer debt in over 100 countries, and detains a database of over 60 million companies around the world with constant updates: payment experience, financial updates, seller experience, country risk etc. All the needful knowledge to extend, reduce or decline credit.
“In 2011, Coface continued to conjugate profitability and growth. Current net profit stood at €121 million, up 21% and turnover was 1,550 million ( including €102 million in Pacific Asia region), up 7,4% compared to 2010,” MR. Le Henand added.
The ratings assigned to Coface by Fitch (AA- with a stable outlook) and by Moody’s (A2 with a stable outlook) have been confirmed, as such reflecting Coface’s solid competitive position in the worldwide credit insurance market.
About Coface Emirates Services :
Coface Emirates Services was established in September 2005 and is based in the financial hub of Dubai, DIFC.
The mission of Coface Emirates is to help companies in the Middle East reduce the risk of extending credit to domestic and international customers. Coface Emirates currently offers solutions in three business lines: Credit Insurance-related services , Debt Collection, and Company Information (Business Reports, Credit Opinion and Coface Rating).
About Coface :
The Coface Group, a worldwide leader in credit insurance offers companies around the globe solutions to protect them against the risk of financial defaults of their clients, both on the domestic market and to export. The group’s new governance set up around 7 geographical platforms, reinforced by the “Strong Commitment” project, is proving its effectiveness.
4,600 employees in 66 countries provide a local service worldwide. Each quarter, Coface publishes its assessments of country risk for 157 countries, based on its unique knowledge of companies’ payment behaviour and on the expertise of its 350 underwriters. In France, Coface manages the export of public guarantees on behalf of the French state.It’s become the world leader in all developing markets, especially BRIC countries and Africa. Coface became entirely debt-free in 2011.
