When debt can be an asset…

FACTORING could be simplified and summed-up as buying debt.

Along with wider bank support and government initiatives, it is seen as a route to liquidity for Spain’s SMEs, with total factoring volumes in Spain reaching €182bn in 2020. The country’s AEF (Association of Factoring) was founded in 1988 and includes almost all the specialised credit institutions in the country, representing around 75 percent of the factoring and confirming market.

It has 20 members, compiled of credit institutions and banks such as BBVA, Santander, CaixaBank and BNP Paribas. Membership ensures service to banks and financial institutions in the region, increasing the funding available to the region’s SMEs. Commercial credits managed by AEF’s members, as a proportion of Spain’s GDP, increased to 22.44 percent in 2020.

The AEF is also a permanent member of the Steering Committee of the EU Federation for the Factoring and Commercial Finance Industry. It brings together factors serving the region and represents them for the various institutions of the Spanish state. It promotes factoring activity in the country and abroad, produces reports, research and studies that shed light on the financing environment in the country, and aims to evolve factoring as a whole. It also promotes initiatives among members for professional development.

UK firm HPD Lendscape, an international secured-lending platform vendor, is becoming an AEF member. The firm is focused on serving the Iberian market, and recently launched a Spanish-language website. HPD LendScape CEO Kevin Day said the collaboration would keep the firm “close to the Spanish market”.