Chinese B2B e-commerce company Alibaba.com's import and export service platform subsidiary Shenzhen One-Touch Enterprise Service has released a virtual B2B credit card with a 180-day credit line.
The new virtual credit card is one of the visual manifestations of Alibaba's attempt to develop financial services for transnational e-commerce transactions. The card allows overseas buyers to make credit purchases from mainland China merchants, providing them with financial support and payment guarantee as part of comprehensive international customs, logistics, insurance and financial services for international trade.
Buyers need only log into the website, submit their application, and undergo a credit check, which may take up to one month. Once approved, buyers can inform suppliers of their credit limit, the total value of their planned orders, and term of credit, and once the platform has evaluated and approved the suppliers' credentials, Alibaba Onetouch will advance payment of up to 80% to the supplier.
The virtual credit card's business model relies on charging daily interest on credit extended to buyers, as well as insurance fees based on the country of export and term of credit.