According to new research, invoice finance is becoming more and more important to the lending landscape not only in the UK, but across Europe as well. Research by Demica has shown that as lending credit remains restricted across Europe, factoring and invoice discounting are starting to play bigger roles for a range of small and medium businesses. This is one of the first times the whole invoice finance industry has been surveyed and analysed across the European stage, and so the findings of the survey are interesting to say the least.
Demica’s research has revealed that the aggregated European invoice finance market was estimated to value around £892 billion. This is compared to £811 billion in 2010 and £690 billion in 2009. This is a demonstration of a compound growth rate of 10%, a great figure to be seeing. This shows that invoice finance is becoming an economically significant source of funding across Europe, and represents around 8% of the total corporate lending within the 27 EU member states. It’s also approximately five times the size of the European lending market in 2011.
Philip Kerle, Chief Executive of Demica, commented: “As tight conditions persist for traditional lending, invoice finance – in its various forms – has stepped up to the plate to fill the funding gap. We believe that this is the first time that the invoice finance market has been viewed as a whole, and our report has demonstrated its economic significance in Europe, playing a vital role in funding economic recovery at a time when bank credit continues to undergo a substantial ‘squeeze’.”
It’s clear that invoice finance is becoming a vital means to funding for a whole range of businesses. If your company needs to unlock fast, flexible funding that grows in line with your sales, then you won’t be alone in turning to invoice finance.