As part of its Business Beyond Borders Series launched earlier this year, the Dubai Chamber of Commerce and Industry in cooperation with Coface and NGI organised a workshop on Trade Credit Management Solutions, at the Chamber premises recently.
Born out of the Chamber-organised Africa Global Business Forum, this second workshop focused on making informed credit decisions determining credit worthiness of new trading partners for companies expanding into new markets as well as shedding light on trade credit insurance and how it works by experts in the field.
The workshop, which was conducted by Victoria Monteiro, senior credit analyst, Coface Emirates Services Ltd, provided on-the-ground, practical, and real-time information on trade credit risks through real business cases as well as determining the credit worthiness of new trading partners while distinguishing a good customer from a potentially bad one.
In the session on How to grow your business safely, Sankar Ramachandran, head of direct sales, National General Insurance, provided an insight to trade credit insurance detailing its functioning and how companies can get access to funding while protecting their trade receivables.
In his welcome address, Omar Khan, director, International Relations, Dubai Chamber, said, "These workshops focus on management risk and maintaining good returns on your growing revenues, whether it is in the UAE market or beyond. The workshops delve technically into trade credit insurance as well as highlighting opportunities in certain promising countries in Africa.
"Emerging markets in Africa for example have a higher return but also a higher risk which is beyond a UAE bank's lending policy, so the bank may limit its financing exposure to the extent of the UAE receivable portfolio and the creditworthiness of the UAE client. This problem may be compounded due to lack of access to funding in the other market by the two trading partners.
"It's here that International Trade Credit Insurance comes in to fill the gap. It helps to cover the risk, makes international receivables attractive to banks, and help to increase turnovers' growth rates between buyer and supplier. Our goal as Dubai Chamber is to work with partners like Coface to help catalyse the economic activities between Dubai and Africa with such solutions and our extensive presence in these markets," said Khan.
Massimo Falcioni, CEO of Middle Eastern Countries, said: "As every business expansion entails taking risks, companies have to be ready with strategies to mitigate these risks especially when making inroads into new markets. To mitigate commercial risks, companies should be able to make accurate assessment of how potential trade partners would perform. We at Coface are constantly analysing the financial stability of companies and growth in the emerging economies to present an efficient report to our valued partners and clients.
"Dubai Chamber has explored many of the most promising markets across the world to help UAE businesses expand into new frontiers, and Coface Emirates Services is very pleased to partner with them in helping ensure that these businesses succeed with proper information. Through this collaboration, Dubai Chamber members will now have access to both our local and global multinational credit risk management expertise, with presence in 99 countries and a database of more than 65 million companies monitored worldwide on their behaviour of payment," he added.
Ramachandran, said: "Africa is one of the most sought-after markets today and companies who are keen to tap this massive land of opportunity will want to check the credibility of their potential trading partners. National General Insurance, in partnership with Coface, offers global credit insurance solutions to protect companies against the risk of financial default as they pursue their expansion into Africa.
"Our partnership with Dubai Chamber will arm enterprises with comprehensive protection against potential non-payment of trading partners and at the same time enhance their access to funding," said Ramachandran.
During the 3rd Africa Global Business Forum (AGBF) last November, Dubai Chamber signed a memorandum of understanding (MoU) with Coface and the National General Insurance Company (NGI) to cooperate in supporting Chamber members in African trade and exports as well as those exporting to Africa with access to NGI trade credit insurance products while Coface will provide various value-added services that aim to assist companies entering or expanding their businesses in the continent besides organising a series of workshops and training courses.