Invoice Factoring Market Report 2024

This Invoice Factoring market report covers market characteristics, size and growth, segmentation, regional and country breakdowns, competitive landscape, market shares, trends and strategies for this market. It traces the market’s historic and forecast market growth by geography.

The invoice factoring market size has grown rapidly in recent years. It will grow from $2.78 trillion in 2023 to $3.09 trillion in 2024 at a compound annual growth rate (CAGR) of 11.1%. The growth observed in the historic period can be linked to several factors such as the rising adoption of fintech solutions by small and medium-sized enterprises (SMEs), enhanced network security, expanding trade with rapidly growing markets, and a rise in open account trading.

The invoice factoring market size is expected to see rapid growth in the next few years. It will grow to $4.8 trillion in 2028 at a compound annual growth rate (CAGR) of 11.6%. The projected growth during the forecast period can be attributed to several factors such as a rise in entrepreneurial ventures, the expansion of e-commerce and online marketplaces, increased demand for factory services, enhanced network security, and a growing need for alternative financing options for micro, small, and medium enterprises (MSMEs). Key trends anticipated during this period include advancements in technology, integration of blockchain, product innovations, novel contract capabilities, and the incorporation of artificial intelligence (AI) and machine learning (ML).

The growing demand for fintech solutions is anticipated to drive the expansion of invoice factoring. Fintech solutions involve leveraging innovative technologies to improve and streamline traditional financial services and processes. This surge in fintech adoption is driven by factors such as evolving customer expectations, increased digital connectivity, dissatisfaction with traditional financial services, and the unbundling of financial services. Invoice factoring enhances the growth and innovation of fintech solutions by improving cash flow management, integrating advanced technologies, diversifying financial services, increasing accessibility, streamlining processes, and fostering market growth. For example, as of November 2023, the International Financial Trade Administration reported that the FinTech sector in the UK includes over 1,600 firms, with this number expected to double by 2030. Hence, the rising popularity of fintech solutions is fueling the growth of the invoice factoring market.

Major players in the invoice factoring market are focusing on developing advanced solutions, such as web-based invoice financing, to offer more flexible and user-friendly platforms for businesses to manage their receivables, enhance cash flow, and reduce administrative burdens. A web-based invoice financing solution is a digital platform that allows businesses to secure financing by leveraging their outstanding invoices, thereby improving cash flow with immediate access to funds based on amounts due from customers. For instance, in July 2024, the State Bank of India (SBI) introduced a Web-Based Invoice Financing Solution. This solution streamlines the borrowing process, making it more accessible and efficient for businesses seeking to leverage their accounts receivable for immediate cash flow needs. This initiative is particularly relevant as many small and medium-sized enterprises (SMEs) in India face challenges accessing formal credit.

In January 2022, FundThrough, a Canadian company specializing in invoice financing and factoring services, acquired BlueVine's invoice factoring business for an undisclosed amount. This acquisition aims to strengthen FundThrough's position in the invoice factoring market, enhance its service offerings, and expand its customer base. BlueVine Capital Inc., a US-based company, specializes in invoice factoring services.

Major companies operating in the invoice factoring market are Industrial and Commercial Bank of China Limited (ICBC), Adobe Inc., Intuit Inc., Lloyds Bank Corporate Markets PLC, American Express Company, Accord Financial Corporation, eCapital Corpororation, Fundbox Inc., Riviera Finance LLC, Sonovate Limited, TBS Factoring Service LLC, Porter Capital Corporation, Barclays Bank UK PLC, Triumph Financial Inc., Nav Technologies Inc., Eagle Business Credit LLC, Breakout Capital Finance Holdings Inc., Invoiced Inc., Paragon Financial Group Inc., Velotrade Management Limited.

Europe was the largest region in the invoice factoring market in 2023. Asia-Pacific is expected to be the fastest-growing region in the forecast period. The regions covered in the invoice factoring market report are Asia-Pacific, Western Europe, Eastern Europe, North America, South America, Middle East, Africa.

The countries covered in the invoice factoring market report are Australia, Brazil, China, France, Germany, India, Indonesia, Japan, Russia, South Korea, UK, USA, Canada, Italy, Spain.

Invoice factoring is a financial transaction and a form of debtor finance in which a business sells its accounts receivable (invoices) to a third party, known as a factor, at a discount. This process provides the company with immediate cash flow, while the factor takes on the responsibility of collecting the outstanding invoice amounts from the business’s customers. Businesses often use invoice factoring to manage cash flow, particularly those with extended payment cycles or seasonal sales variations.

There are two main types of invoice factoring are recourse factoring and non-recourse factoring. In recourse factoring, the client business remains liable for any unpaid invoices by their customers. Invoice factoring services are offered by banks and non-banking financial companies (NBFCs). This financial solution is utilized by various enterprise sizes, including large enterprises, small and medium-sized enterprises, and is applicable across different industries such as construction, manufacturing, healthcare, transportation and logistics, energy and utilities, information technology (IT), telecom, staffing, and others.

The invoice factoring market research report is one of a series of new reports that provides invoice factoring market statistics, including invoice factoring industry global market size, regional shares, competitors with an invoice factoring market share, detailed invoice factoring market segments, market trends, and opportunities, and any further data you may need to thrive in the invoice factoring industry. This invoice factoring market research report delivers a complete perspective of everything you need, with an in-depth analysis of the current and future scenario of the industry.

The invoice factoring market includes revenues earned by entities by immediate cash advances, debt collection, industry-specific solutions. The market value includes the value of related goods sold by the service provider or included within the service offering. Only goods and services traded between entities or sold to end consumers are included.

The market value is defined as the revenues that enterprises gain from the sale of goods and/or services within the specified market and geography through sales, grants, or donations in terms of the currency (in USD, unless otherwise specified).

The revenues for a specified geography are consumption values that are revenues generated by organizations in the specified geography within the market, irrespective of where they are produced. It does not include revenues from resales along the supply chain, either further along the supply chain or as part of other products.

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