Alibaba.com ramps up its international trade protection program

Via the Trade Assurance program, buyers who make purchases from participating Alibaba.com suppliers will be entitled to full refunds of their deposits, or if applicable the total value of their orders, if suppliers ship products late or if product quality does not meet contract specifications.

The program, launched in May, initially included only Chinese suppliers with reliable track records of trading on Alibaba.com who volunteered to participate. Coverage will be expanded to all suppliers who volunteer and are qualified to participate regardless of home country. About 50,000 suppliers have joined the program, according to Alibaba.com.

Trade Assurance protects buyers by holding deposits or payments in escrow until they are satisfied that suppliers have met the terms and conditions of the sales contracts.

The program is designed to reduce risk and foster greater trust and trade among Alibaba.com buyers and suppliers, most of whom conduct business over the Internet and never meet in person. By providing maximum trade protection, cross-border trading is set to be easier, therefore empowering small-and medium-sized businesses to engage in global trading, as highlighted by Alibaba Group Senior Vice President Wu Min Zhi.
Trade Assurance protection is available to all of Alibaba.com’s global buyers, if the supplier they want to do business with is approved for the program. To vet suppliers, Alibaba.com uses data analytics to assess past performance and trading histories over six-month periods. The program currently only covers payments made by telegraphic transfer (T/T), but other payment methods will be covered in the future, Alibaba.com said.

Small businesses who qualify for the Trade Assurance program are encouraged to display a Trade Assurance icon on their Alibaba.com virtual storefronts. To further improve transparency, storefronts also display the total number of transactions and total value of deals the supplier has completed over the previous 12 months. In addition, Alibaba.com will show how often and how quickly qualified suppliers respond to customers.