The turnover of commercial factoring, referring to factoring by non-financial institutions, surged 300 percent from 2013 to about 80 billion yuan in China last year, according to data from China Association of Trade in Services (CATIS).
By the end of 2014, the balance of financing via commercial factoring stood at about 20 billion yuan, doubling the figure from the end of 2013. Thanks to the participation of increasing non-banking market players such as large conglomerates, central enterprises, state-owned enterprises (SOE), IT and E-commerce giants, the turnover of commercial factoring is likely to balloon to 200 billion yuan in 2015, and the balance of related financing is expected to top 50 billion yuan by the end of the year.
So far, factoring, as an industry of credit services reversely related to economic activity, had grown to be a trade financing tool that best fits small business with robust growth momentum, said Han Jiaping, secretary general of Commercial Factoring Expertise Committee of CATIS.
Han made the remarks on a ceremony inaugurating a commercial factoring firm established by Shanghai Guojin Leasing Co., Ltd. and a financial services company of Shanghai Industrial Investment (Holdings) Co., Ltd., a local SOE in Shanghai. They hold respectively 40 percent and 60 percent of equities in the new commercial factoring business.
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