The Alibaba Trade Assurance Program is meant to add an extra layer of security to overseas buyers of goods, primarily, from Chinese suppliers. As such, the Trade Assurance allows the buyer to receive a refund, if any of the following occurs:
1.The shipment is delayed, beyond the specified shipping date
2.The manufactured items are not compliant with the provided quality requirements
We’ll get back to these later, but let’s stick to the basics for now. The Trade Assurance program is only offered to Alibaba Gold Suppliers that meet certain criteria. Thus, Trade Assurance is not offered when buying from all suppliers. Currently, the number of suppliers offering this, is somewhat limited, but almost certain to grow rapidly in the coming months.
The amount, covered by the Trade Assurance, is also limited, and often ranging between US$10,000 to US$30,000. That said, it is often enough to cover the initial deposit order, which is mostly set at 30% of the total, FOB, order value. Before, there was also a minimum transaction amount, set at US$1,000. However, as of 2015, this is no longer the case, as the minimum order amount has been removed.
What importers should also notice, is that the Trade Assurance only covers transactions that are first registered through the Alibaba checkout system, following a payment to the bank account specified by Alibaba. For obvious reasons, Alibaba is not offering any Trade Assurance on payments made to private, or offshore, accounts. That said, the transaction is still not made ‘within’ Alibaba, but, for example, by Telegraphic Transfer.