Factoring Services Industry Overview

The global factoring services market size was estimated at USD 4,185.05 billion in 2023 and is expected to grow at a CAGR of 10.5% from 2024 to 2030. The market has been experiencing steady growth in recent years, owing to the increasing demand for alternative financing options among small and medium enterprises. Factoring services offer businesses the ability to secure working capital loans and reduce credit risks. Moreover, the rising use of innovative technologies, such as Artificial Intelligence (AI) and machine learning, is anticipated to enhance fraud risk identification, streamline underwriting processes, deliver operational savings, and simplify payment applications.

Gather more insights about the market drivers, restrains and growth of the Factoring Services Market

Significant growth in the Banking, Financial Services, and Insurance (BFSI) industry is a key driver positively impacting market expansion. Moreover, the increasing demand for quick and hassle-free financing sources among Micro, Small, and Medium Enterprises (MSMEs) is driving market growth. Factoring services help businesses secure working capital loans and mitigate credit risks.

Furthermore, the integration of Artificial Intelligence (AI) and machine learning is anticipated to enhance fraud risk identification, streamline underwriting processes, provide operational savings, and simplify payment applications. Fintech companies and banks have embraced these technologies to develop innovative products and maintain competitiveness in the market. The high precision of these tools and the resultant reduction in human underwriting are likely to enable significant outsourcing of decision-making capabilities within the market.

According to industry trends, 91% of financial services companies are either using AI solutions across their operations or have already implemented AI to foster innovation, boost operational efficiency, and enhance customer experiences. The implementation of automation solutions has allowed financial institutions to significantly enhance their operational processes, particularly in accounts receivable. These solutions can integrate with various technologies such as automation, AI, and machine learning throughout the credit cycle, enabling institutions to manage financial operations more effectively.

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Factoring Services Market Segmentation

Grand View Research has segmented the global factoring services market based on category, type, financial institution, end-use, and region:

Factoring Services Category Outlook (Revenue, USD Billion, 2018 - 2030)

• Domestic
• International

Factoring Services Type Outlook (Revenue, USD Billion, 2018 - 2030)

• Recourse
• Non-recourse

Factoring Services Financial Institution Outlook (Revenue, USD Billion, 2018 - 2030)

• Banks
• Non-banking Financial Institutions

Factoring Services End-use Outlook (Revenue, USD Billion, 2018 - 2030)

• Manufacturing
• Transport & Logistics
• Information Technology
• Healthcare
• Construction
• Staffing
• Others

Factoring Services Regional Outlook (Revenue, USD Billion, 2018 - 2030)

• North America
  1. U.S.
  2. Canada
  3. Mexico 
• Europe
  1. UK
  2. Germany
  3. France
  4. Italy
  5. Spain
  6. Poland
  7. Belgium
  8. Netherlands
• Asia Pacific
  1. China
  2. India
  3. Japan
  4. South Korea
  5. Australia
• Latin America
  1. Brazil
• Middle East & Africa (MEA)
  1. UAE
  2. Saudi Arabia
  3. South Africa

Key Companies profiled:

• altLINE (The Southern Bank Company)
• Barclays Bank PLC
• BNP Paribas
• China Construction Bank Corporation
• Deutsche Factoring Bank
• Eurobank
• Factor Funding Co.
• Hitachi Capital (UK) PLC
• HSBC Group
• ICBC China
• Kuke Finance
• Mizuho Financial Group, Inc.
• RTS Financial Service, Inc.
• Société Générale S.A.
• TCI Business Capital

Key Factoring Services Company Insights

Some of the key players operating in the market include BNP Paribas Fortis; altLINE (The Southern Bank Company); and Triumph Financial, Inc. among others.

• BNP Paribas Fortis by leveraging its extensive network and robust financial infrastructure, the company offers comprehensive factoring solutions tailored to various industries, ensuring liquidity and improving businesses' cash flow. Renowned for its service excellence, BNP Paribas Fortis provides high advance rates and competitive discount rates, making it a preferred partner for businesses seeking to optimize working capital and manage receivables effectively.
• altLINE (The Southern Bank Company) to improve the company’s brand visibility and reputation altLINE partners with commercial bankers, accountants, business advisors, and other intermediaries and offers its lending capabilities. By enhancing its presence through targeted marketing efforts, altLINE aims to solidify its market position and become the go-to choice for businesses seeking factoring financing services.

Factor Funding Co., Invoice Funding Limited, and Eurobank Factors SA are some of the emerging market participants in the factoring services market.

• Eurobank Factors SA is strategically leveraging factoring as a key market strategy to fuel its growth. By focusing on factoring services, the company is capitalizing on a strategic approach tailored to meet the specific needs of its target markets. This emphasis on factoring allows Eurobank Factors SA to tap into opportunities that align closely with its strengths and market positioning, enabling the company to expand its market presence and enhance its competitive edge.
• Factor Funding Co., by adopting a forward-thinking approach is primarily focusing on understanding the unique needs of its clients, the company has tailored its key market strategy to provide flexible and innovative financing solutions. By leveraging strategic partnerships and continuously refining its offerings, Factor Funding Co. has positioned itself as a trusted partner for businesses seeking reliable cash flow solutions.

Recent Developments

• In February 2024, BNP Paribas Fortis and Worldline, a multinational payment and transactional services company based in France, announced extending their partnership, with plans envisaging the extension starting from February 2024 for a tenure of at least five years, emphasizing providing top-tier, customer-focused issuing solutions.
• In May 2024, ABN AMRO Bank N.V. reached an agreement with Fosun International to acquire Hauck Aufhäuser Lampe, a private banking institution based in Germany. Following the acquisition, Bethmann Bank, the bank’s private banking arm in Germany, is positioned to become a significant player in providing banking solutions to private clients, family-owned enterprises, and institutional clients across the nation. The acquisition was also aimed at setting the bank’s competitive edge and offering the staff of the newly acquired entity a chance to take a lead in the evolving banking landscape in Germany.

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