First Attempts to Size the SCF Market

The SCF market is still  evolving - it is a competitive business and business undertaken is covered by customer/bank confidentiality and therefore sources of information are constrained and not widely in the public domain.

The receivables financing segment including factoring, invoice discounting and receivables finance in all its forms remains the largest segment with an estimated 60% market share. It is primarily domestic in focus and is likely to experience steady growth.  Banks, bank owned subsidiaries and a variety of non- bank financial institutions are the main providers. Country practices vary widely.

Buyer-centric SCF techniques, such as Reverse Factoring and Approved Payables Finance, represent less than 30% of the market but have strong growth potential. Global banks are today mainly concentrated on the large buyer side of the trade equation and this is the heritage of the cleverly structured solutions engineered and provided by banks for large international trading companies. It will need a ‘tipping point’ to see these instruments taker-off on a broad scale really take off.

Inventory and pre-shipment finance is quite specialised and not widely practised outside certain industries and commodities. These practices hold a 10% share in market size, with a predicted growth in the next 5 years.