Press Release 05 April 2012
Factors Chain International released today the much
awaited figures for the 2011 worldwide factoring industry
Fresh statistics indicate that the total worldwide volume for factoring increased sharply in 2011 with more than 22% compared to 2010. The world total stands now at €2,015,007 million or US$ 2,610,844 million, in other words, well over 2 TRILLION, whether in Euro or in U.S. dollars.
Overall, the factoring industry weathered the global financial crises much better than many other providers in the financial and insurance sectors. Even though volumes dropped somewhat in 2009, the 2010 figures far exceeded the 2008 figures, the previous record year in the factoring history. The strong growth continued in 2011, another record year.
Major markets with spectacular growth were China (+77%), Russia (+74%), South Africa (+41%), Netherlands (+31%), and Australia (+28%).
For FCI members the results were even more impressive: the total volume increased with more than 24%, while international volume went up with nearly 37%. The results illustrate that exporters and importers, around the world, are becoming more and more familiar with the advantages to be derived from a factoring arrangement: working capital, credit risk protection and collection service for the exporter, while the importer benefits from buying on open account terms without the need to open letters of credit or to accept other payment conditions with a similar restrictive character.
When Mr. Jeroen Kohnstamm, Secretary General of FCI, was asked to comment on the recent statistics, he expressed confidence that the factoring industry is well positioned to play a more and more important role in providing working capital and risk management services to an ever increasing number of corporate clients.He added the comment: Factors do not replace the services offered by banks. On the other hand, more and more banks develop a factoring capability, either through specialised subsidiaries or through specialised divisions/departments. The factoring approach to risk management is fundamentally different from the way banks assess financial risks. Through factoring, against the purchase of invoices, the funding is far more secure than in cases where other forms of collateral are used to provide security for traditional bank lending. As a result, the factoring industry is more and more an extension of the banking industry, but with ample space for independently owned factoring companies.
In connection with international factoring, Mr. Kohnstamm added: Just as predicted in the past, the importance of the Asian markets for cross-border factoring has further increased. The biggest percentage growth has been seen in inter-Asian trade, including a remarkable growth of import factoring in markets such as China, Taiwan and Hong Kong. Even so, the major EU countries and the U.S.A. remain strong “users” of cross-border factoring services, whether for exports or for imports.
The FCI website is updated with the new 2011 factoring statistics.