Factoring and Invoice Finance stagnate in 2014 in the key SME sector - As fear of hidden costs and forced insolvencies scare companies away!

It has been another difficult year for the factoring industry showing very little growth in terms of client numbers with the 6,669 new clients taken on in the first nine months of the year being almost completely negated by the 6,397 lost in the same period.

The statistics provided by ABFA show that the 43,708 companies using factoring and invoice discounting as at the end of September were using £19.3 billion of funding which was an increase of 12% on the previous year’s funding levels, with the increase only seen in large users.  So that the wonder funder for SME's that ABFA miss led the Treasury Select committee has been shunned due to the high level of abuse in this unregulated finance industry.

With over eighty percent of the number of companies turning over £5m or less and their numbers actually using factoring declined by over 100 businesses (Less companies to be forced to be closed by unscrupulous factoring companies). 

700 companies turning over in excess of £50m pa meaning that less than 2% of the total number of companies was responsible for nearly forty percent of the total funding thus making the bragging of ABFA meaningless.

Leaving published statistics aside almost all factoring insiders are complaining about the lack of activity in the market and have done so for most of the year.  With most of the factoring companies and brokers feeling the pinch.  The good news here is the hated insolvency practitioners are finding it hard to pay their lavish life styles and school fees.
 
Factoring companies continue to rip their clients off forcing them to sign contracts with heads the factoring company wins and tails the client loses with debentures, personal guarantees and charges on their clients house (nice little earner - unless your the client).

Factoring brokers are seeing a collapse of the market with enquiries down by 30%and Insolvency practitioners seeing their business vapourise in front of their eyes due to few hostile liquidations.