Romanian factoring market is half the European average
The Romanian factoring market has a big growth potential, say
companies in the sector, considering that the market's share in the
gross domestic product is half the European average, with
increasingly more companies choosing to sell their invoices in
order to secure cash at a time when access to classic funding lines
from banks is limited.
In Romania the factoring market accounts for just 1.5% of the gross
domestic product (GDP), compared with the 3% European average and
with the 9-10% share of developed countries.
In Poland the share of the factoring market to GDP was slightly
down last year, to 2.2%, whilst in Hungary it remained steady over
the last few years, at 3.2% of GDP. The largest factoring market is
UK's, with such businesses accounting for over 10% of GDP.
The Romanian factoring market has seen a fast growth in the past
few years, as the number of players rose, but their businesses made
up as little as 0.7% of GDP just three years ago.
The market continues to be dominated by banks, with the BCR, BRD
and UniCredit Tiriac Bank cumulating a 71% market share, according
to UniCredit data. At the same time, competition has started to
tighten, with the market having recently seen the entry of
Portuguese-held Millennium Bank and of Maltese group FIMBank,
which, in partnership with RomFactor, will offer a platform for
factoring services in Romania and the Republic of Moldova.
The Romanian factoring market reached 1.97 billion euros last year,
up 77% against 2007. This year, despite the significant growth
potential, players are expecting stagnation in the value of
discounted invoices with companies focusing more on risk management
and less on high turnovers.
The largest number of requests came in 2008 from companies in the
transportation, constructions, steel and food industries. At
present, there is a big growth potential on the pharmaceutical
market, where a lot of invoices are due to be reimbursed by the
Romanian Health Insurance House.