Annual Figures for 2004 - factoring and invoice discounting has now become a £132 billion industry
Annual figures for 2004 on the invoice finance sector reveal that the UK market has become a £132billion industry, with almost 40,000 companies - 94% of which are SMEs - turning to invoice finance as an alternative to more traditional funding options. In the last year the number of SMEs using factoring and invoice discounting rose by 11 per cent from 35,914 to 39,895.
The 2004 figures also showed a significant 16 per cent increase in the use of invoice discounting compared with a year earlier, with member firms now providing a record £109.7billion to over 15,000 businesses - further demonstrating that invoice discounting is continuing to increase in popularity amongst SMEs and corporate's. Factoring has also shown growth, providing £17.7billion to over 19,500 SMEs and manufacturing continues to be the leading sector using factoring and invoice discounting, with over 12,500 manufacturers using FDA services.
The industry figures also show that the UK's late payment culture has worsened, businesses using invoice discounting and factoring are finding that their customers are taking longer to pay than they were in 2003. The average number of debtor days (days waiting for payment) has increased from 57 days in 2003 to 60 days in 2004.
Also, more and more businesses are turning to export factoring to fund their export drive, with export factoring having grown by 9 per cent compared with 2003. Review advantages of invoice finance.
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