World Factoring Yearbook 2021 shows sharp differences in factoring markets in 2020

The factoring markets of the world’s major factoring regions showed many differences between each other in 2020, with markets in the Americas suffering the most from the pandemic, usually showing a decline in factoring volume of well over 10 per cent, while countries in Europe and Asia generally showed much lower decreases in volume and sometimes even growth.

“The factoring industry has a long and established place as an industry that provides working capital and other services to SMEs that sell products and services in the B2B and B2G sectors. In the United States, total factoring volume in 2020 dropped significantly”, said Mark Mandula and Alina Hall, United Capital Funding Group.

“Factoring activity in China grew significantly in 2020 compared to 2019, across both the bank and commercial factoring (non-bank) sectors, as the Chinese economy displayed resilience despite the COVID-19 pandemic”, explained Chris Wohlert, Wells Fargo Commercial Distribution Finance.

“The factoring industry in Mauritius has been impacted in contradictory ways during the past year”, said Jean-Mee Ernest, MCB Factors.

“Without any doubt, 2020 has been one of the most challenging years that we have lived as mankind and as Mexicans in particular”, stated Victor Portillo Sánchez, Banco Monex.

“The pandemic not only had a severe impact on people’s health, but it also affected the economy, including the Portuguese factoring industry”, said Vitor Graça, Portuguese Association of Leasing, Factoring and Renting.

“While domestic factoring has been the major contributor until now [in India], there is a clear shift towards international factoring with a specific emphasis on non-recourse export factoring”, underlined Ravi Valecha, India Factoring and Finance Solutions Pvt. Ltd.

“Despite the difficult environment in 2020, factoring had another positive year of growth…The fact that most of these businesses are focused on imports, makes factoring even more relevant for the market, explained Florentina Idrizaj – Demi, Merita Gjyshinca – Peja, Raiffeisen Bank Kosovo JSC.

“Overall, the number of factoring clients has decreased [...]. This decline does not come as a surprise given the economic challenges experienced in South Africa during 2020, arising from the negative impact of Coronavirus (COVID-19) on business activities”, said Nompumelelo Karumbidza, Nedbank Limited. 

“Domestic factoring in Brazil remains exotic in comparison to that of other countries, due to unique methods of payment utilised between corporates in the domestic market”, said João Costa Pereira, Banco Ourinvest S.A.

“With the dramatic drop in sales, businesses were forced to shift their financing mix from short term financing, normally receivables-based, to other, longer term financial facilities, stated Alessandro Carretta and Diego Tavecchia, ASSIFACT, Italian Factoring Association.

To read more, please order the World Factoring Yearbook 2021 here.