As China e-commerce leader Alibaba grows its position within the B2B digital commerce industry, the company is investing in new ways to aid the financing of procurement. Last month, the conglomerate revealed a new partnership with alternative lender Lending Club to launch e-Credit Line, which will offer loans to small- and medium-sized businesses that use Alibaba to procure goods.
Now, the company has launched a payment protection venture to strengthen its services to B2B buyers.
Reports revealed Tuesday (March 3) that Alibaba revealed its Trade Assurance Program during this week’s ASD Market Week. The service is a buyer protection program for procurement officials buying from Chinese suppliers through Alibaba’s B2B e-commerce platform.
Alibaba.com’s Head of International Marketing and Business Development Michael Lee told Forbes that the new service increases the level to qualify for B2B online sales. “The market has long needed a trusted destination to connect serious buyers and suppliers,” he said. “In business-to-business, however, nothing existed. Essentially, Alibaba and our Trade Assurance Program creates a trusted ecosystem for those serious buyers and suppliers to connect and work together.”
Reports say Alibaba vets and evaluates the millions of buyers and suppliers using its platform to connect. When a supplier is evaluated, Alibaba establishes its Trade Assurance Limit, and guarantees to buyers that their purchases will be delivered on time and uphold the standard upon which the buyer and supplier agreed.
The service is also a way for those buyers and suppliers to establish that agreement before an order is placed. Alibaba announced it would refund up to 100 percent of the order amount if those agreements are not fulfilled for buyers.
Plus, reports say, Alibaba only requires a minimum of $1,000 to participate in the program, a level low enough to allow SMEs to take part. Buyers will also be able to offer feedback on the program and the suppliers with which they do business.
“It’s important for our buyers to evaluate the suppliers they work with, which they can easily do as part of the Trade Assurance Program,” Lee said. “This helps other buyers gain insight on suppliers, allowing them to make more educated decisions on their own buying choices.”
As Alibaba strengthens its B2B e-commerce offerings, reports say the company plans to focus on supplier data to offer services within the supply chain that are needed. Both the e-Credit Line buyer lending program, and the Trade Assurance Program, Alibaba said, are part of the company’s efforts to create a “seamless sourcing experience” for procurement officials.