Factoring Market by Type (International Factoring, Non-Notification Factoring, Notification Factoring), Industry (Aerospace & Defense, Automotive & Transportation, Banking, Financial Services & Insurance) - Global Forecast 2024-2030

Factoring Market by Type (International Factoring, Non-Notification Factoring, Notification Factoring), Industry (Aerospace & Defense, Automotive & Transportation, Banking, Financial Services & Insurance) - Global Forecast 2024-2030

The Factoring Market size was estimated at USD 3.85 trillion in 2023 and expected to reach USD 4.10 trillion in 2024, at a CAGR 7.19% to reach USD 6.26 trillion by 2030.

Factoring is a debtor finance medium where a business sells its invoices or accounts receivables to a third party, called a factor, at a discount. It is an essential tool for providing working capital to businesses that might have cash flow issues due to slow-paying customers or longer sales cycles. The end-users of factoring services are diverse, including small businesses struggling with cash flow gaps due to delayed payments from customers, seasonal businesses requiring funding during peak periods, and fast-growing companies in need of working capital for business expansion. Improved international trade enhances opportunities for factoring companies to address cross-border transaction challenges faced by exporters/importers. However, limited awareness of factoring services among businesses and strict regulatory frameworks aimed at factoring services have impacted their adoption worldwide. Market players are expected to keep up with the changing regulations while ensuring the provision of quality services to expand the market development. They are also leveraging advanced data analytics tools to improve risk assessment and decision-making processes, allowing factors to gain a competitive edge.

Regional Insights

In the Americas, factoring is widely utilized by small to medium-sized enterprises (SMEs) seeking immediate cash flows instead of waiting for invoice payments. Many factoring companies are currently focusing on collaborating with fintech companies to improve efficiency through automation solutions. The Asian market has been experiencing rapid growth in recent years because of increasing trade activities within emerging economies such as India and China. Asia-Pacific is home to smaller factoring businesses and less-established credit histories compared to other regions; however, the region shows potential for new entrants and international player expansion. Europe is among the largest factoring markets globally due to the well-established regulatory framework that promotes more comprehensive credit risk management practices. Factoring service providers in Europe focus on providing tailored solutions considering the unique needs of clients, varying from small single-invoice transactions to comprehensive supply chain finance programs for large-scale buyers and suppliers.

Market Insights

Market Dynamics

The market dynamics represent an ever-changing landscape of the Factoring Market by providing actionable insights into factors, including supply and demand levels. Accounting for these factors helps design strategies, make investments, and formulate developments to capitalize on future opportunities. In addition, these factors assist in avoiding potential pitfalls related to political, geographical, technical, social, and economic conditions, highlighting consumer behaviors and influencing manufacturing costs and purchasing decisions.

Market Drivers

Need for consistent working capital among small & medium size enterprises
Rising international trade activities and cross-border transactions
Increasing focus on financial risk mitigation across industries

Market Restraints

Impact on the creditworthiness of users and hidden costs of factoring

Market Opportunities

Technological advancements in factoring solutions and services with AI & ML
Interest in promoting sustainable business practices through green factoring

Market Challenges

Complexity of factoring agreements and terms & conditions

Market Segmentation Analysis

Type: Emerging need of factoring to help businesses for managing better working capital management of the businesses
Industry: Exponential penetration of factoring for digital banking and government & public industries to ensure smooth financial operations

Market Disruption Analysis

Porter’s Five Forces Analysis
Value Chain & Critical Path Analysis
Pricing Analysis
Technology Analysis
Patent Analysis
Trade Analysis
Regulatory Framework Analysis

FPNV Positioning Matrix

The FPNV positioning matrix is essential in evaluating the market positioning of the vendors in the Factoring Market. This matrix offers a comprehensive assessment of vendors, examining critical metrics related to business strategy and product satisfaction. This in-depth assessment empowers users to make well-informed decisions aligned with their requirements. Based on the evaluation, the vendors are then categorized into four distinct quadrants representing varying levels of success, namely Forefront (F), Pathfinder (P), Niche (N), or Vital (V).

Market Share Analysis

The market share analysis is a comprehensive tool that provides an insightful and in-depth assessment of the current state of vendors in the Factoring Market. By meticulously comparing and analyzing vendor contributions, companies are offered a greater understanding of their performance and the challenges they face when competing for market share. These contributions include overall revenue, customer base, and other vital metrics. Additionally, this analysis provides valuable insights into the competitive nature of the sector, including factors such as accumulation, fragmentation dominance, and amalgamation traits observed over the base year period studied. With these illustrative details, vendors can make more informed decisions and devise effective strategies to gain a competitive edge in the market.

Recent Developments

Breakout Capital and 12Five Capital Join Forces to Create a Powerhouse in Small Business Lending

Breakout Capital, LLC, a fintech company committed to simplifying access to term loans for small businesses, announced the successful merger with 12Five Capital. This merger aims to cater to the evolving needs of small businesses across the United States by offering a comprehensive suite of specialized financial products. These encompass convenient access to term loans, factoring, purchase order financing, and asset-based lending.

TAB Bank Completes USD 46 Million Acquisition of BAMFi’s BAM Capital Division

TAB Bank completed the strategic acquisition of the BAM Capital Division from BAMFi, adding USD 46 million to its portfolio of working capital loan assets. This marks the bank's fourth successful purchase and promises to broaden its presence, especially in the Texas market. With the acquisition, TAB Bank has absorbed a diverse clientele from the transportation, staffing, and manufacturing sectors and integrated the operations and seasoned staff at BAM's Dallas office.

FactorCloud Announces Partnership with Ansonia Credit Data

FactorCloud announced a partnership with Ansonia Credit Data, giving their customers access to Ansonia's advanced business credit and collections decision tools. This partnership allows FactorCloud customers to seamlessly factor invoices by setting specific criteria. These criteria are automatically evaluated based on the credit score and other key performance indicators (KPIs). This automation significantly enhances the efficiency of factoring companies' teams, enabling them to allocate their time to more intricate decision-making processes.

Strategy Analysis & Recommendation

The strategic analysis is essential for organizations seeking a solid foothold in the global marketplace. Companies are better positioned to make informed decisions that align with their long-term aspirations by thoroughly evaluating their current standing in the Factoring Market. This critical assessment involves a thorough analysis of the organization’s resources, capabilities, and overall performance to identify its core strengths and areas for improvement.

Key Company Profiles

The report delves into recent significant developments in the Factoring Market, highlighting leading vendors and their innovative profiles. These include ABN AMRO Group, Aerofund Financial, Inc., American Receivable, Apex Capital Corp., Axiom Bank, N.A., Bluevine Inc. By Fundthrough, BNP Paribas S.A., Breakout Capital, LLC, Canbank Factors Ltd., Capital One Financial Corporation, Catalyst Financial Company, CIT Group Inc., Close Brothers Group PLC, Deutsche Leasing Group, Drip Capital Services India LLP, eCapital, Inc., FactorCloud, Fundbox, Inc., Infusion Funding, LLC, King Trade Capital, New Century Financial, Inc., Nucleus Commercial Finance Ltd., OTR Solutions, Riviera Finance of Texas, Inc., Rosenthal & Rosenthal, RTS Financial Service, Inc., Simplex Group, TAB Bank, TBS Factoring Service, LLC, Triumph Financial, Inc., and Universal Funding Corporation.

Market Segmentation & Coverage

This research report categorizes the Factoring Market to forecast the revenues and analyze trends in each of the following sub-markets:

Type
International Factoring
Non-Notification Factoring
Notification Factoring
Industry
Aerospace & Defense
Automotive & Transportation
Banking, Financial Services & Insurance
Building, Construction & Real Estate
Consumer Goods & Retail
Education
Energy & Utilities
Government & Public Sector
Healthcare & Life Sciences
Information Technology
Manufacturing
Media & Entertainment
Telecommunication
Travel & Hospitality
Region
Americas
Argentina
Brazil
Canada
Mexico
United States
California
Florida
Illinois
New York
Ohio
Pennsylvania
Texas
Asia-Pacific
Australia
China
India
Indonesia
Japan
Malaysia
Philippines
Singapore
South Korea
Taiwan
Thailand
Vietnam
Europe, Middle East & Africa
Denmark
Egypt
Finland
France
Germany
Israel
Italy
Netherlands
Nigeria
Norway
Poland
Qatar
Russia
Saudi Arabia
South Africa
Spain
Sweden
Switzerland
Turkey
United Arab Emirates
United Kingdom

Please Note: PDF & Excel + Online Access - 1 Year