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Market Research Report
Factoring Market: Global Industry Trends, Share, Size, Growth, Opportunity and Forecast 2020-2025 |
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| Published by | IMARC Services Private Limited | Product code | 967717 | ||||
| Published | Content info | 144 Pages Delivery time: 2-3 business days |
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| Factoring Market: Global Industry Trends, Share, Size, Growth, Opportunity and Forecast 2020-2025 | ||
| Published: December 5, 2020 | Content info: 144 Pages |
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The global factoring market grew at a CAGR of around 12% during 2014-2019. Factoring, or debtor financing, refers to the process of purchasing a debt or invoice from an organization at discounted prices to allow profits to the buyer upon settlement. It is an asset-based financial arrangement between a financial institution, or a factor, and the client, which states the terms and conditions of exchanging trade debts. Recourse, non-recourse, disclosed, discourse, domestic, export advance and maturity factoring are some of the commonly adopted forms of the process. They relieve the first party off the debts and provides them with the essential working capital to continue trading, while the buyer, or factor, capitalizes on the profits when the debt is paid.
Significant growth in the banking, financial services and insurance (BFSI) industry is one of the key factors creating a positive impact on the market growth. Furthermore, the increasing requirement for alternative sources of financing for micro, small and medium enterprises (MSME) is providing a thrust to the market growth. Factoring enables the business to obtain working capital loans and mitigate credit risks. In line with this, increasing awareness regarding the benefits of supply chain financing, such as factoring, is also contributing to the market growth. Additionally, the advent of blockchain technology and cryptocurrency in factoring services is acting as another growth-inducing factor. These advanced solutions automate each invoice with unique identification for fast funding, complete transactional security and smart contract facilities. Other factors, including the increasing utilization of digital platforms in trade financing, along with the rising cross-border trade activities, are anticipated to drive the market further. Looking forward, IMARC Group expects the global factoring market to continue its strong growth during the next five years.
Figure 11 Global: Factoring (Domestic) Market Forecast: Sales Value (in Million US$), 2020-2025
