GVR Report cover Factoring Services Market Size, Share & Trends Report

Factoring Services Market Size, Share & Trends Analysis Report By Category (Domestic, International), By Type (Recourse, Non-recourse), By Financial Institution, By End Use, By Region, And Segment Forecasts, 2022 - 2030

  • Report ID: GVR-4-68039-178-0
  • Number of Pages: 120
  • Format: Electronic (PDF)
  • Historical Range: 2017 - 2020
  • Industry: Technology

Report Overview

The global factoring services market size was valued at USD 3,393.90 billion in 2021 and is expected to expand at a compound annual growth rate (CAGR) of 8.8% from 2022 to 2030. The rise in open account trading opportunities and the need for alternate sources of financing for Small & Medium Enterprises (SMEs) to meet immediate business goals or cash flows are expected to drive the growth of this market. The COVID-19 outbreak significantly affected global economic activities and caused stock market volatility, which hampered the growth of the market in a short term.

U.S. factoring services market size, by type, 2020 - 2030 (USD Billion)

After the COVID-19 pandemic, the governments of several regions become the top competitor for factoring services providers as governments implemented forgivable programs and essentially zero cost money. However, businesses are finding alternatives such as remote working and other technological innovations to keep up with their competitors. Moreover, factoring services are utilizing technology to offer better services and are expected to show considerable growth over the forecast period.

Businesses often have to wait for customers to pay, which affects the cash flow. To remediate this delay, factoring companies are offering upfront cash in exchange for account receivables, which makes factoring services more preferable. Factoring services enable businesses to obtain working capital loans and mitigate credit risks. Moreover, the increasing adoption of cryptocurrency and blockchain among private sector non-banks is driving the growth of the factoring services market.

Technological advancements such as automated invoices with a unique id, smart contract facilities, transactional security management, and fast funding are expected to drive market growth in the coming days. For instance, Barclays Plc engages in corporate investment banking, and wealth management, among other solutions to offer flexible funding to organizations by allowing them to choose invoices committing to the entire sales ledger. Additionally, the bank would offer confidential whole-ledger discount services and assess organizations’ maximum credit limit against eligible outstanding invoices.

The factoring companies have another advantage: they can integrate well with the organizations’ existing accounting software, which leads to no admin hassle. Employees can focus on important jobs instead. Since factoring companies serve various industries, their rates and level of customer service may vary and the ability to complete the process and provide advance payment within 24 – 72 hours makes the service faster than bank loans.

The factoring service mitigates credit risk by completing the responsibility of debt collection. However, new technologies are helping factoring companies to better serve customers by giving them access to web portals and applications to review and answer common questions related to their accounts. Additionally, benefits such as cost-effectiveness, powerful insights and reporting, and thorough credit evaluation are expected to increase the demand for factoring services.

The factoring services are helpful in many ways, such as the need for secure financing, which is subject to strong fluctuations due to seasonal changes in the marketplace. To overcome financial issues, organizations depend upon factoring services to provide financial stability such as security against payment defaults, reduced cost of maintaining sales ledger, cash rebates offered by suppliers, and debtor management services. Businesses involved in logistic and manufacturing services find factoring as an ideal way of financing, as these firms have numerous accounts receivable from other businesses.

Category Insights

The domestic segment is expected to account for the largest market share of over 70% over the forecast period. The domestic factoring companies can offer up to 90% of the amount of advance payment within 24 hours of receipt of the invoices. They can also provide businesses with a weekly or monthly analysis of sales and payable invoices. The high domestic demand for goods and services, addressed by all resident units to satisfy their needs, in countries such as China owing to the government’s effort to fuel private consumption is the key factor driving the growth of this segment.

The international segment is anticipated to register considerable growth with a CAGR of 9.4% over the forecast period. The international factoring service is a must need service for firms engaged in international trade, irrespective of size and the industry they deal with. The importers in developed countries consider factoring a suitable alternative to conventional methods of trade finance. Moreover, a rise in international trade awareness and a shift of production facilities after the outbreak of COVID-19 from China to other economies are boosting the growth of this segment.

Type Insights

The recourse segment is expected to account for a market share of over 50% over the forecast period. This service requires a guarantee from the owner to maintain liquidity in case of bad debt and purchase back nonperforming accounts receivable taken as collateral by factor. It offers benefits such as lower fees, flexibility on advanced rates, and flexibility in credit requirements. It is used by firms with creditworthy invoice clients and who want to sell invoices at the lowest discounts. The growth of the segment is attributed to the fact that firms pay smaller factor fees and receive the maximum money possible for invoices.

As developing nations are adopting non-recourse factoring services, the non-recourse segment is expected to grow during the forecast period. In a non-recourse factoring service, the factoring firm bears if any bad debt occurs. Thus, it has more stringent credit requirements. This service offers complete credit security to businesses and is a good option for businesses with a large customer base as they may want to clean up their balance sheet by offloading their accounts receivable. The service is widely used among truckers as they want financial security when it comes to getting paid on loads.

Financial Institution Insights

The bank's segment held the largest market share of over 80% in 2021. As banks are the major financing organizations, they are anticipated to witness growth over the forecast period. Bank factoring firms use the process of traditional factoring firms regulated by banks without middlemen, leading to lower factoring costs. Banks are investing resources in technologies such as Distributed Ledger Technology (DTL) to meet the financial needs of their clients. Factors such as direct access to cash, security from a regulated bank, and more competitive rates are expected to drive the growth of this segment.

The non-banking financial institution segment is anticipated to witness significant growth of 10.1% over the forecast period. The growth is attributed to the flexibility and transparency offered by these institutions. These institutions are adopting the latest technologies to compete with banks. For instance, RTS Finance, one of the top invoice factoring companies for trucking, offers web and mobile applications for better integration with their platform. Truckers can track the status of the transaction and get benefits such as fuel card discounts and no hidden costs such as automated clearing fees.  

End-use Insights

The manufacturing segment accounted for the largest market share of over 30% in 2021. The segment utilizes factoring services to enable manufacturers to negotiate early-pay discounts and take advantage of bulk orders and other payment incentives. Most companies in the manufacturing sector are seasonal, which leads to poor cash flow and fluctuations in the business. To avoid this, manufacturing firms rely on factoring services. Other advantages of factoring services include high advance rate, volume-based factoring fees, credit analysis of prospective customers, and elimination of payment gaps.

Global factoring services market share, by end use, 2021 (%)

Segments such as transport & logistics and healthcare are anticipated to witness substantial growth over the forecast period. Freight factoring helps avoid debt and accomplish tasks such as paying drivers, buying fuel, and paying for repairs on time. The healthcare industry relies on factoring services to gain benefits such as medical insurance claims that can be paid within 72 hours instead of the usual 30 to 120 days. The services can reduce the overhead created by tracking claims, collections, and invoices. It also offers flexibility to small clinic owners as they can choose only a few claims to be financed.

Regional Insights

The European region accounted for a major market share of over 55% in 2021. This is attributed to the rapid adoption of factoring services in Central and Eastern Europe (CEE) and the strategic importance of receivables funded by the commercial banking sector. The region has the presence of fast-growing banks and is experiencing increased trade with fast-growing markets in Eastern bloc countries. Various service providers of this region are focusing on automating the process by utilizing advanced technologies such as blockchain, which provide advanced data security and smart contract functionality.

The Asia Pacific is expected to witness considerable growth over the forecast period owing to the expansion of the manufacturing sector in economies such as India and other South & Southeast Asian countries. These countries are shifting from agrarian to manufacturing and export-oriented economies, which is propelling the growth of the market in the region. The presence of developing economies such as China and Thailand is promoting investments from developed markets that are saturated and exploring new opportunities. These factors are likely to spur the demand for factoring services in the region.

Key Companies & Market Share Insights

Market players are focusing on strategic partnerships and mergers & acquisitions to engage with existing and new clients and increase their market shares. They are investing in advanced technologies such as distributed ledgers to gain a competitive edge in the market. For instance, Unicsoft, a Scotland-based software company, developed a factoring solution to offer enhanced transaction security. The solution provided automated low-overhead ways of securing transactions and enabled the use of smart contract technology to improve speed, reliability, and security. Some prominent players in the global factoring services market include:

  • Barclays Bank PLC

  • BNP Paribas

  • China Construction Bank Corporation

  • Deutsche Factoring Bank

  • Eurobank

  • Hitachi Capital (UK) PLC

  • HSBC Group

  • ICBC China

  • Kuke Finance

  • Mizuho Financial Group, Inc.

Factoring Services Market Report Scope

Report Attribute


Market size value in 2022

USD 3,566.99 billion

Revenue forecast in 2030

USD 7,005.90 billion

Growth rate

CAGR of 8.8% from 2022 to 2030

Base year for estimation


Historical data

2017 - 2020

Forecast period

2022 - 2030

Quantitative units

Revenue in USD billion and CAGR from 2022 to 2030

Report coverage

Revenue forecast, company ranking, competitive landscape, growth factors, and trends

Segments covered

Category, type, financial institution, end use, region

Regional scope

North America; Europe; Asia Pacific; Latin America; Middle East & Africa

Country scope

U.S.; Canada; Germany; U.K.; France; Italy; China; India; Japan; Singapore; Mexico; Brazil; Chile

Key companies profiled

China Construction Bank Corporation; Deutsche Factoring Bank; Barclays Bank PLC; BNP Paribas; Hitachi Capital (UK) PLC; Eurobank; HSBC Group; ICBC China; Kuke Finance; Mizuho Financial Group, Inc.

Customization scope

Free report customization (equivalent to up to 8 analysts working days) with purchase. Addition or alteration to country, regional & segment scope.

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Avail customized purchase options to meet your exact research needs. Explore purchase options


Segments Covered in the Report

This report forecasts revenue growth at global, regional, and country levels and provides an analysis of the latest industry trends and opportunities in each of the sub-segments from 2017 to 2030. For this study, Grand View Research has segmented the global factoring services market report based on category, type, financial institution, end use, and region:

  • Category Outlook (Revenue, USD Billion, 2017 - 2030)

    • Domestic

    • International

  • Type Outlook (Revenue, USD Billion, 2017 - 2030)

    • Recourse

    • Non-Recourse

  • Financial Institution Outlook (Revenue, USD Billion, 2017 - 2030)

    • Banks

    • Non-Banking Financial Institutions

  • End-use Outlook (Revenue, USD Billion, 2017 - 2030)

    • Manufacturing

    • Transport & Logistics

    • Information Technology

    • Healthcare

    • Construction

    • Others

  • Regional Outlook (Revenue, USD Billion, 2017 - 2030)

    • North America

      • U.S.

      • Canada

    • Europe

      • Germany

      • U.K.

      • France

      • Italy

    • Asia Pacific

      • China

      • India

      • Japan

      • Singapore

    • Latin America

      • Brazil

      • Mexico

      • Chile

    • MEA

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