Coface has opened a branch in New Zealand, tapping what the credit insurer says will be strong growth in the country’s trade credit insurance market over the next seven years.

Coface has been serving New Zealand from its Australian office for over 20 years but opened a standalone branch this month after gaining approval from the Reserve Bank of New Zealand.

“With this new licence, Coface is well positioned to serve brokers and securitise trade for businesses of all sizes trading here and abroad,” the credit insurer says in a statement.

New Zealand punches above its weight in trade. Despite only just scraping into the world’s top 50 economies, it ranks 26th in the world for exports per capita. The country’s goods exports jumped by 6% to NZD$63.3bn (US$44bn) in 2021, according to government figures.

“While trade credit insurance is common in Europe, companies in New Zealand are always unaware credit risk is insurable and able to be securitised,” says Chris Little, Coface’s country manager for Australia and New Zealand, who will lead the new branch.

The insurer says New Zealand’s trade credit insurance market size was valued at US$9.4bn in 2019 and is projected to reach US$18.1bn by 2027.

Globally, it says it is witnessing an uptick in claims that was widely forecast as government stimulus measures enacted during the early phases of the coronavirus pandemic are gradually wound down.

“There is an increased demand for quotes this year, as companies look to make informed decisions about taking these risks on or using credit insurance as a tool to trade and grow safely,” Little says.

There have been 74 corporate insolvencies administered by New Zealand’s insolvency service so far this financial year, which ends in June, already topping the 69 recorded in the 2020-21 financial year.