2014 was another impressive year for the factoring industry. In fact, it continues this amazing trajectory of growth, as evidenced in the doubling in size of the industry since the start of the financial crisis in 2009. Even as international trade softens due to the uneven economic recovery and as we witnessed the plummeting of commodity prices, along with quite a volatile foreign exchange environment, the factoring industry grew by 6% in 2014, surpassing EUR 2.35 trillion in global annual volume. Cross border international factoring grew at an even faster pace, generating over of € 490 billion in volume last year, representing a 22% increase! This continued strong emerging market-led rebound marks a significant milestone for trade finance in general and factoring in particular.
As open account trade continues to expand, FCI has become the platform and method of choice for most financial institutions to offer their local clients cross border open account solutions as an alternative to traditional letters of credit and documentary collections. However, FCI is more than just a bridge between its members, but also a vehicle for change, by representing the interests of the receivables finance industry through promotion, education and lobbying efforts targeted to those institutions that can influence and effect change in their home markets, including ministries of trade, central banks, trade associations, and leaders in trade finance around the world.
They have come to understand and appreciate that factoring is a secure and reliable method of financing trade and an invaluable means to provide liquidity to SMEs, the engine of growth in most economies. It is my hope that this publication will contribute to a better understanding of our industry and the important role international factoring plays in providing solutions in a more globalised marketplace.
About: FCI (Factors Chain International) is the world’s most important factoring network with over 270 member companies spread across the globe. FCI’s head office in Amsterdam works in close cooperation with its members offering exporters a truly international reach when it comes to financial services.
Source: FCI Annual Review