Credit insurer COFACE announced that the Russian state authority for insurance (FSSN) has granted a license to its subsidiary "ZAO COFACE Rus Insurance Company" based in Moscow, according to Insurance Journal. COFACE is the first international credit insurer to obtain its license in Russia.
Russian credit insurance market is currently estimated at EUR 40 million COFACE is already one of the four major players, offering credit insurance for four years due to a technical agreement with its local partner, KAPITAL, stated the companies officials.
Also, the authorization will enable the credit insurer to deliver its own credit insurance offer, and will further benefit both the clients and COFACE by offering an increased quality of service for its clients, especially for Russian subsidiaries of international companies, notably French and German, and an easier access of Russian companies to COFACE credit insurance expertise.
Didier BOURGEOIS, Country Manager for Russia commented: "COFACE's ambition is to become market leader in trade receivables management in Russia, thanks to its worldwide presence, deep knowledge of local risks and large 'bouquet of services' offered to Russian and international customers."
BOURGEOIS also explained that the license "widens its presence in Russia, where all our products are now available. There are currently 60 people working in COFACE's Moscow headquarters and in an office in St Petersburg. It first began operations in Russia 18 years ago, COFACE Rus Services, to offer credit management services, business information, and debt collection. COFACE already compiles information on 600,000 Russian companies.
The bulletin explained that Russia has been severely hit by the crisis and COFACE saw its payment experience deteriorate sharply up until the end of 2009. The company expects the Russian economy to record positive but moderate growth of 4 percent in 2010 (after -7.9 percent in 2009), due to the upturn in the oil prices and capital inflows after several months of lost confidence.
"Nonetheless, the Russian economy faces structural weaknesses in private governance. COFACE publishes a business climate rating, which assesses how risky it is to do business in a country based upon the quality of information available on companies, and the legal protection given to creditors. In this field, Russia is rated B, the lowest of the BRIC countries. The average transparency of Russian corporate accounts and the efficiency and fairness of creditor rights in Russia leave room for improvement."
