Before You Wire the Deposit — Does This Supplier Even Exist?
Vetting a Chinese Supplier — From Reading the Business License to Qichacha & Tianyancha

Hello, this is GreenFrog Seoul.

"We've been chatting on WeChat just fine, but the moment I go to send a 30% deposit, my hand freezes."
"The company name sounds legit — but does this factory actually exist?"
"They sent a photo of their business license, sure. How am I supposed to read it?"

In China sourcing, the moment money moves in the biggest way is usually the first deposit. The goods aren't in your hands yet, the other side is just a name on a screen, and the payment leaves for a real bank account. The minimum safeguard that bridges this gap is a credit check. Not some elaborate audit — just confirming, before you hit send, that "this company really exists, it's the one I think it is, and there's no major incident on its record." Fortunately, China has fairly well-developed public channels for company information, so free tools alone cover a lot of ground.

Here's the point up front: a Chinese supplier credit check starts with reading one document properly — the business license (营业执照). This registration certificate carries the company's official name, its 18-digit Unified Social Credit Code, the legal representative, registered capital, business scope, establishment date, and address, letting you gauge whether the party is a real registered entity and whether it's even qualified to make these goods in the first place. Layer on litigation, penalties, and shareholder data from lookup services like Qichacha (企查查) and Tianyancha (天眼查), cross-check once more against the official registry, and most of the risk becomes visible before you wire a cent. Today we walk through that order, step by step.

Having covered the types of trade scams and how to prevent them at a high level (#13), and how to tell a factory from a trading company (#50), today we read the source documents behind those judgments directly. This is how you verify a counterpart by paperwork, not by talk.

1. Why a Credit Check — the Minimum Due Diligence Before a Deposit

Payment in China sourcing usually starts with a deposit up front (#8). The common flow is to send 30% first, have the goods made, then pay the balance and ship. The problem is that at the moment those 30% go out, all the buyer holds is the other side's word and a WeChat thread. No goods, no collateral — the money moves first.

A credit check tries to narrow this asymmetry, even a little. What you're checking really comes down to two things. One is existence — is this a genuinely registered legal entity on paper, and does the company the contact names match the account holder? The other is risk — is it tangled in litigation, has it been hit with administrative penalties, is it flagged as operationally abnormal?

A perfect investigation is impossible anyway. But even a basic check that takes 30 minutes filters out the most dangerous few — shell companies, or an account under a mismatched name. A credit check isn't there to prove "this supplier is 100% safe"; its value is in seeing the clearly dangerous signals ahead of time.

2. The Business License (营业执照) — Reading It Line by Line

The business license is a Chinese company's most basic ID card — the equivalent of a business registration certificate. A properly registered company has one and will send a photo or scan on request. The challenge comes after you receive it: you have to know what to look at on this sheet dense with Chinese characters before the check can begin.

The 18-digit Unified Social Credit Code — the key to every lookup

The first thing to find is the Unified Social Credit Code (统一社会信用代码). This 18-character mix of digits and letters is assigned one per company — the corporate equivalent of a national ID number. Every lookup we'll cover starts with these 18 digits, so copy the number down accurately from the license first. If the digit count is short or the format is off, that alone is reason to doubt the document.

Name and legal representative — no mismatched identities

The official name (名称) is your baseline for checking that the contract and, above all, the remittance account holder match it. In a normal transaction with a Chinese company, payment goes to a corporate (对公) account in the company's name. So when someone asks you to "send it to a personal account," or gives an account name completely different from the one on the license, that's your cue to be on guard.

The legal representative (法定代表人) is the person who legally represents the company — the baseline for who has authority to sign a contract. If the person stamping the contract, or your day-to-day contact, differs from the legal representative, it's worth confirming the chain of authorization is clear.

Registered capital — subscribed (认缴) isn't paid-in (实缴)

There's a common misread around registered capital (注册资本): "10 million RMB registered — must be a solid company." Half right, half wrong. Chinese registered capital is generally on a subscribed (认缴) basis — the amount shareholders pledged to contribute — not the money actually paid in (实缴). It's common to see a large pledge with a far smaller amount actually deposited.

Business scope — is '生产/制造' there?

The business scope (经营范围) is the range of business the company is legally permitted to do. What the buyer watches for here is manufacturing-related wording. A factory that actually makes goods will likely have '生产 (production)' or '制造 (manufacturing)' in its scope, while a company that only sells or trades will read mostly '销售 (sales)' or '贸易 (trade)'.

That one line is a useful clue for the factory-vs-trading-company call we covered earlier (#50). If you were introduced to a "factory" but the scope has no manufacturing wording at all — only trade and sales — it may in fact be a trading company that buys and resells. Don't decide on scope alone, though; cross-check it with an audit or a video confirmation to be sure.

Establishment date and address — track record and reality

The establishment date (成立日期) shows when the company was founded. An older company isn't automatically better, but wiring a large deposit to a freshly minted entity means there's that much less history to check. The establishment date is one baseline for gauging a counterpart's track record.

The address (住所) is the registered location. Look it up on a map and compare it with the factory or office you see on a video call or during an audit, and you confirm its reality one more time. If the registered address differs sharply from the actual site, or the address is written only vaguely, it's worth asking why.

3. Qichacha & Tianyancha — What the Free Lookups Show

Once the license has confirmed the company's "identity," the next step is its "history." The go-to tools here are Qichacha (企查查) and Tianyancha (天眼查). Both aggregate public information on Chinese companies; search by company name or Unified Social Credit Code and you can see a fair amount even within the free tier.

Three things matter most to a buyer here. First, watch the registration status — is it active? A revoked entity, or one on the operationally-abnormal list, is a danger signal in itself. Next comes litigation and penalty history; a large company may have a few suits, but if breach-of-contract or payment disputes recur, that's a different story. Last, the shareholders and affiliates — if you see traces of the same legal representative setting up and dissolving similar companies over and over, it's a place to re-examine the substance.

Both services are in Chinese and some detail sits behind a paywall, but the core danger signals — whether the company is active, and whether there's serious litigation, penalties, or a default record — are generally visible in the free tier. If Chinese is daunting, just turning on your browser's translation is enough to read the big picture.

4. Cross-Checking — the Official Registry, Badges, and an Audit

Lookup services are convenient, but rather than trusting one source, it's safer to confirm the same facts across different channels. Trust in a credit check ultimately comes from cross-verification.

The official registry — gsxt.gov.cn

The National Enterprise Credit Information Publicity System (gsxt.gov.cn), run by the Chinese government, is the official source of record for company registration data. You can take the Unified Social Credit Code to this official system and check once more whether the registration data Qichacha and Tianyancha show matches the actual public filing. If the private service and the official system disagree, it's best to hold off judgment until you know why.

The limits of Alibaba verification badges

Many buyers relax at the sight of a 'Gold Supplier' or verified-supplier (认证供应商) badge on Alibaba. Such marks aren't meaningless, but they're mostly grounded in a paid membership or some information checks — not a guarantee of the company's creditworthiness or ability to pay. A platform badge is a signal that "a minimum threshold was cleared," and it doesn't replace reading the business license and checking litigation history (#11).

Tying it off with a video call or factory audit

Whatever you've confirmed on paper is best tied off, at the end, by seeing it once more. The simplest way is a video call. Just asking them to hold the original business license up to the camera, and to show you the production line or office live, filters out a shell company to a large degree. For a large amount or a relationship that will run long, it's safer to add a step — a third-party audit or a visit in person (#7) — to compare the registered address against the actual site.

5. Red-Flag Checklist

Gather everything above into one place and the red flags to filter out before a deposit come into view. If even one of the items below trips, stop the payment and confirm the reason first.

These signals don't automatically mean "scam." But each is a marker that more checking is needed. A legitimate supplier clears most of them without trouble, and the trust actually builds in that process of explaining. Conversely, when several signals overlap and the explanations keep slipping, it's better to reconsider the deal.

6. Pre-Deposit Credit-Check Checklist

Document check (business license)

• Got a copy of the license and captured the 18-digit Unified Social Credit Code accurately
• Cross-checked that the official name matches the contract and the remittance account holder
• Confirmed whether the scope carries manufacturing (生产/制造) or only trade/sales
• Gauged track record from the establishment date, reality from the address

History lookup (Qichacha / Tianyancha)

• Confirmed the registration status is active
• Checked there's no serious litigation, penalty, or default record
• Read the shareholder / affiliate structure and matched the contracting party to the payee

Cross-verification (official / audit)

• Cross-checked the registration data once more via the official system (gsxt.gov.cn)
• Didn't lean on the platform badge alone — ran a separate lookup too
• Saw the original license and the site with my own eyes, by video call or audit

Closing — The 30 Minutes Before You Hit Send

Today's content, compressed one line each:

• Why do it: a deposit leaves with no goods and no collateral, so you need the minimum safeguard of seeing existence and risk in advance
• Business license: read it field by field — the 18-digit code, matching identities, manufacturing wording in the scope, subscribed-vs-paid-in capital, establishment date and address
• Qichacha / Tianyancha: confirm registration status, litigation, penalties, defaults, and shareholder structure within the free tier
• Cross-check: verify against the official registry, treat the Alibaba badge as only a starting point, and tie it off by eye with a video call or audit
• Red flags: when identity mismatch, a personal-account request, document dodging, or an abnormal listing overlap, stop the payment

Choosing a good supplier ultimately comes down to putting a skeleton of paperwork and history behind that name on the screen. The 30 minutes it takes to read one business license properly and run one more lookup protect a large deposit. If you can't tell whether the Chinese company you're evaluating is trustworthy, or how to read the license you received, feel free to reach out. From document checks to lookups to arranging an audit, we'll help in one flow.