Factoring, double-digit growth for the sector. And Banca Sistema exceeds 4 billion in turnover – Corriere.it

The factoring market is growing in Italy, with turnover (the amount of receivables assigned to the factor) which, despite the weakening of economic activity in the last quarter of the year, stood at 287 billion euros in 2022, with an increase of 14.61% compared to the previous year (Assifact data). And for 2023 a continuation of growth is expected, albeit at a more contained pace, estimated at around 5 percent. In this scenario, Bank System reached at the end of 2022 a value of purchased receivables exceeding 4.4 billion euro, with a compound annual growth rate (CAGR) of 21% over the last 10 years (the turnover amounted to 585 million in 2012) and a portfolio which in 2022 was enriched by a further 120 customers. Exceeding the 4 billion purchased credit mark is an important milestone for Banca Sistema’s factoring, which in 2022 outperformed a market that nonetheless recorded solid growth. A CAGR of 21% of the turnover in the decade and the further consolidation abroad in the Iberian Peninsula confirm the role of the factoring division of the group in supporting the needs of working capital and the improvement of the net financial position of large and small and medium enterprises, in particular suppliers of the Public Administration.

The reasons for the growth

In recent years, according to Trupia, awareness of a tool that not all entrepreneurs are yet familiar with has increased: in particular – he underlines – the greater use of factoring has above all affected the world of receivables from the public administration. But with it split payments (the VAT debtor is the customer directly and not the seller or service provider, ed.) The use of factoring for VAT credits has also grown. Collection times have also improved and the introduction of electronic invoices was the driving force above all, which has brought enormous benefits, especially in relations with the world of public health.

The advantages of factoring

By assigning their receivables to a factoring company, companies can transform future receivables into immediate liquidity, improving cash flows and reducing the risk of insolvency. And this is even more true for companies that have relationships with the Public Administration, which historically has always had very long payment times. In our case, then, the non-recourse option (in addition to the credit, the risk of default is also transferred, which therefore remains with the factor, ed) a further positive element – ​​Trupia points out -. Let’s think of the companies that have relationships with the municipalities and that often find themselves suffering their instability, which can last at least 3-4 years. With factoring you get rid of this risk, optimizing liquidity management. Furthermore, for large companies, Trupia points out, the main advantage is an improvement in the net financial position in the balance sheet (the difference between liquid assets and total financial debts), as well as being able to have a professional person able to to manage the collection of several thousand invoices and resolve any disputes: a benefit that also translates into savings in terms of costs and dedicated employee personnel.

Eligible companies

All companies have the opportunity to access factoring, subject to certain conditions, which can change from factor to factor. In our case, for example, it is essential that companies have credits with the Public Administration, which is our core business – argues Trupia -. We screen all companies, from the largest to the smallest, and focus especially on those companies that are growing and winning new contracts. Also because an entrepreneur who wins a new contract like this knows that he can rely on a factoring company to have the cash flow necessary to grow the company. Furthermore, the absence of any tax or criminal issues is important. Costs? They are on average with the market, with a spread above the Euribor, and are directly influenced by the expected collection times, she concludes.