Global commerce firm Tradeshift is to integrate a risk indicator service into its platform after entering a strategic partnership with global credit insurer Coface.
The partnership, Tradeshift’s first with a credit insurance firm, will see Coface launch an app on the Tradeshift platform that helps businesses better assess and monitor counterparty risk.
The aim is to “co-develop an innovative solution to guide companies through the complexity of global trade and to protect them against the risk of non-payment”, the firms say in a statement.
Patrick Viau, vice-president of global sales at Tradeshift, tells GTR that the app will offer assessments of a range of components, including company and country risk, and business climate. Coface will also provide a ‘maximum credit opinion’, which recommends the highest monthly outstanding amount that a firm should have with a specific debtor at any time.
He adds that users can purchase a ‘one-time company risk check’ – a snapshot of the risk at the time of purchase – or choose to actively monitor the stability of a selected company over a 12-month period. This function will automatically alert users to changes in a company’s risk profile.
The tool will be available to the 1.5 million businesses around the world that currently use Tradeshift’s platform, both buyers and sellers who wish to monitor their suppliers or customers. It will enable them to better identify weaknesses within their supply chain while making smarter and faster credit decisions.
“This first step of bringing Coface into our integrated procurement platform will add another way for our users to be confident that their supply chain is safe and reliable, no matter where they are doing business,” says Christian Lanng, co-founder and CEO of Tradeshift, emphasising that risk management is a “critical component for cohesive global trade”.
The move forms part of Tradeshift’s transformation from being an invoicing platform to covering a full range of supply chain management, financing, payments and compliance services.
The firm offers its users access to more than 200 apps developed by third-party providers.
Last year it started to integrate supply chain financing into its platform, entering partnerships with HSBC in March and Santander in July. This essentially enables the banks to offer financing through Tradeshift.
Apart from HSBC and Santander, Tradeshift’s finance partners include Citi and CreditEase, with more banks currently being onboarded. According to Lanng, the firm is adding one to two banks a quarter to the platform.
He made the comment in May as the firm released Tradeshift Pay to incorporate regular and blockchain-based payments into its offering.
Just one week later, Tradeshift announced it had raised US$250mn in series E funding. The funding round was led by Goldman Sachs and PSP Investments, with additional participation from HSBC, H14, GP Bullhound and Gray Swan, a new venture company established by Tradeshift’s founders. It brought Tradeshift’s total funding to more than US$400mn and saw HSBC, which also took part in the previous funding round, increase its stake in the firm.
Tradeshift said at the time it would use the funding to continue its global expansion in Europe and Asia as well as drive growth in volumes and values across the platform. It will also be used to make strategic investments into emerging technologies, including blockchain and artificial intelligence.
When asked whether Tradeshift users could soon get credit insurance from Coface or other insurers directly on the platform, Viau said the partnership with Coface will focus on the initial offering. But, he said, Tradeshift is working on “other exciting financial products” that will be announced “shortly”.