According to our latest study on "Trade Credit Insurance Market Forecast to 2031 - Global and Regional Share, Trend, and Growth Opportunity Analysis - by Enterprise Size, Application, and End User," the market was valued at US$ 14.19 billion in 2023, and the Trade Credit Insurance market size isprojected to reach US$ 27.56 billion by 2031. The Trade Credit Insurance market is expected to record a CAGR of 8.7% from 2023 to 2031.
Supply Chain Complexities to Provide Lucrative Opportunities for Trade Credit Insurance Market Growth During the Forecast Period
The expansion of the e-commerce industry leads to an increased demand for new supply chain arrangements. The development of new supply chain arrangements raises the complexity of the supply chains, which increases the demand for trade credit insurance among e-commerce to streamline business processes by keeping them running. As a result, market players are developing a new range of trade credit insurance services for the e-commerce industry. For instance, in March 2024, Allianz Trade launched Allianz Trade pay services for B2B e-commerce activities. Allianz Trade Pay is a payment solution that offers a variety of services such as a fraud module, digital buyer onboarding solution, trade credit insurance protection, and instant financing solution through Allianz Trade's financial institution partners. The Allianz Trade pay provides flexibility, security, simplicity, and competitiveness to the e-commerce ecosystem, which increases its adoption in the e-commerce industry to manage its complex supply chains.
Various countries are adopting the multipolar system, which requires the presence of advanced market manufacturers for reshoring or friend-shoring production. This created the demand for parallel and multiple supply chains and relocation of production facilities to fulfill customers' needs across the globe. As a result, a reduction in the supply chain activity for intermediate goods leads to a rise in complexities related to trade, particularly for intermediate goods. For instance, according to the World Trade Organization (WTO) data published on October 2023, supply chain activity for intermediate goods declined by 48.5% in the first half of 2023. It fell from an average of 51.0% compared to the previous three years. Thus, supply chain complexities will raise the demand for trade credit insurance protection against counterparty risk, which is expected to create numerous opportunities for the trade credit insurance market growth during the forecast period.
Key Findings of Trade Credit Insurance Market Study:
The Trade Credit Insurance market analysis has been carried out by considering the following segments: enterprise size, application, and end user. Based on enterprise size, the trade credit insurance market is segmented into SMEs and large enterprises. On the basis of application, the market is divided into domestic and international. Based on end user, the trade credit insurance market is segmented into energy, automotive, aerospace, chemicals, metals, agriculture, food and beverages, financial services, technology and telecommunications, transportation, and others. Furthermore, the energy segment held the largest trade credit insurance market share in 2023.
Based on application, the market is segmented into domestic and international. International trade is the exchange of goods and services between companies located in different countries. There is a rise in global trade due to factors such as lack of technology, demand, education, labor laws, government policies, wages, natural resources, and financing. For instance, according to UNCTAD's latest Global Trade Update published in June 2023, trade growth was positive for both goods and services during the first quarter of 2023. Over the first three months of 2023, trade in goods grew by 1.9% compared to the last quarter of 2022, adding ~US$ 100 billion to the total value. Global services trade also increased by approximately US$ 50 billion, up by about 2.8% compared to the previous quarter. Thus, the rise in international trade has led to the increased adoption of trade credit insurance solutions to avoid any risks, such as insolvency of approved buyers, financial instability, etc.
Moreover, factor such as surge in business insolvencies propel the trade credit insurance market growth. Also, development of cloud-based trade credit insurance solutions is expected to bring new trade credit insurance market trends in the coming years.
The scope of the Trade Credit Insurance market report is primarily divided into North America (the US, Canada, and Mexico), Europe (Spain, the UK, Germany, France, Italy, and the Rest of Europe), Asia Pacific (South Korea, China, India, Japan, Australia, and the Rest of Asia Pacific), Middle East & Africa (South Africa, Saudi Arabia, the UAE, and the Rest of Middle East & Africa), and South & Central America (Brazil, Argentina, and the Rest of South & Central America). Europe accounted for the largest trade credit insurance market share in 2023.
Allianz Trade, COFACE SA, American International Group Inc, Chubb Ltd, QBE Insurance Group Ltd, Aon Plc, Credendo, Atradius NV, Zurich Insurance Group AG, and Great American Insurance Company are among the key players profiled in the trade credit insurance market report.
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