The credit rating has been developed to meet the increasing needs of incorporated companies to demonstrate their financial stability to multiple stakeholders - e.g. suppliers, customers, strategic partners, and financiers.
The credit rating and how it is compiled
The rating is expressed in the form of a series of letters (e.g A, BBB) like those of the traditional rating agencies.
It is determined by a comprehensive and rigorous 3 stage process. Throughout the process both the tools applied and the people engaged in the process review and analyse the data at different stages i.e. no single person applies the rating.
STAGE 1
Collection of information
A questionnaire is completed by the company on which a credit rating is solicited. This information is analysed by Coface and compared to internal information gathered from many sources, including those from within Coface’s 4 business lines. This data represents an unequalled source of payment information across all business sectors worldwide.
STAGE 2
Management review
An in-depth review with the rated company’s management and Coface experts ensures that all relevant information is captured in the report which will establish the credit rating. The rating is the most sophisticated that Coface has developed, reflecting Coface's depth of knowledge in rating companies.
STAGE 3
Validation of the credit rating
The final stage is for a Credit Insurance underwriter to validate the rating. Coface operates with 250 specialists in corporate risk underwriting in 30 centres across the world applying uniform standards and using a common system of risk analysis.
Why Coface’s credit rating is different
Coface's credit rating offers significant advantages in comparison with existing rating services:
- It is based on Coface’s core areas of expertise – our understanding of commercial risk, our underwriting skills and our risk management procedures - these are supported by our extensive sources of data
- It is transparent – the processes are detailed and visible and the rated company is informed of progress at each stage of the process
- It is available at a highly competitive price - representing an excellent return on investment for any buyer
- It is available to a broader market - to medium and small sized companies, for which the traditional agencies are out of reach, but also to companies in emerging countries
- Impartiality is guaranteed – our experts in production and underwriting work independently from our commercial teams
Case Study
AGRI SGJ - View case study
"AGRI SGJ has been with Coface for about 8 years now. I am a strong believer that when you build up a track record with a company like Coface, the mutual trust can be very beneficial to both sides. We as a company have a very seasonal business and for us to be able to call and get a limit in place, sometimes for only 2/3 months means we are able to trade more freely, without the worry of not getting cover. This is just one of the benefits of working with a complete credit management provider."
