Invoice Factoring Market Expected to Reach $4618.9 Billion by 2031—Allied Market Research

According to a new report published by Allied Market Research, titled, “Invoice Factoring Market," The invoice factoring market was valued at $1946.51 billion in 2021, and is estimated to reach $4618.9 billion by 2031, growing at a CAGR of 9.4% from 2022 to 2031.

Invoice factoring can assist business owners in overcoming the time between the creation of an invoice and the actual payment by the client. Moreover, invoice factoring is an alternative form of financing that is available to businesses that may not have an established banking record with a major lender.

Furthermore, major market players are undertaking various strategies to increase the competition and offer enhance services to their customers. For instance, in July 2020, American Express and SAP Concur recently announced two digital integrations to help businesses streamline and automate invoicing and expenses. This first offering is an integration that allows American Express Business and Corporate Card customers to integrate with Concur Invoice. This tool uses machine learning to capture both digital and paper invoices. And then it integrates them into a single system.

On the basis of provider, the banks segment is the highest growing segment. This is attributed to growth in focus on digitalization of financial processes has transformed traditional banking systems, owing to which various banks are providing invoice factoring to significantly support rise in business needs. In addition, growth in digitization across the banking sector has filled existing gaps in financial services and increased efficiency among the banking sector to provide better customer experience, which drives the market growth.

Based on region, Europe attained the highest growth in 2021. This is attributed to significant growth of the invoice factoring market trends in these countries can be further explained from an historic perspective. Moreover, since many of these formerly socialist nations have quickly embraced capitalist practices over the past three decades, with a huge increase in entrepreneurial endeavors and SMEs, it stands to reason that such businesses, frequently with little to no financial history or assets, are frequently the best candidates for invoice factoring services.   

COVID-19 had a positive impact on the invoice factoring industry since, more business were opting for factoring to fulfill short-term cash requirements. Moreover, increase in awareness and understanding of supply chain financing benefits contribute to market expansion, such as business invoice factoring. Furthermore, in the coming years, which is anticipated that this aspect will present the invoice factoring market growth with numerous, very lucrative prospects.

Key Findings of the Study

• By type, the recourse factoring segment led the invoice factoring market size, in terms of revenue in 2021.
• By enterprise size, the large enterprises segment accounted for the highest invoice factoring market share in 2021.
• By application, the domestic segment accounted for the highest invoice factoring market share in 2021.
• By industry vertical, the manufacturing segment accounted for the highest invoice factoring market share in 2021.
• By region, Europe generated the highest revenue in 2021.

The report analyzes the profiles of key players operating in the invoice factoring market analysis such as Adobe, American Express Company, Barclays Bank UK PLC, ICBC, Intuit Inc., Lloyds Bank, Porter Capital, Sonovate, Waddle and Velotrade. These players have adopted various strategies to increase their market penetration and strengthen their position in the invoice factoring market.