EU Federation for Factoring and Commercial Finance webinar: building bridges between Finance and SMEs
Brussels, October 14th, 2020 – Stéphanie Yon-Courtin, MEP (Renew Europe) chaired yesterday a webinar organized by the EUF and dedicated to SMEs’ funding.
Moderated by Fausto Galmarini, vice chairman of the EUF, the event gathered top EU policy makers, Stéphanie Yon-Courtin, Member of the European Parliament and Vice-Chair of the Economic and monetary affairs committee (ECON), Andrea Beltramello, cabinet member of Executive Vice-President Valdis Dombrovskis, factoring providers and EU and national SMEs’ representatives from France, Germany and Italy.
Welcomed by Françoise Palle Guillabert, Chair of the EUF, the panelists shared their expertise, experience and analysis of the ongoing crisis. They also developed the issues that SMEs are facing in obtaining funding, initiatives of the European institutions and solutions provided by finance players.
Stéphanie Yon-Courtin recalled the commitment of the Renew Europe towards the SMEs and asked for more ambition from the EU institutions. She reminded the work already done at the European Parliament, notably through the Capital market union INI report that aims to foster equity financing for SMEs via notably equity research for SMEs, a European Fund for IPOs, a simplification of SMEs’ prospectus, solvency instruments or better tax incentives. Among all the sources of funding, she also noted that factoring could be part of the solution.
Françoise Palle Guillabert added that by providing € 275 billion of working capital financing to 280,000 businesses in 2019 (87% of which are SMEs), factoring can be the bridgehead of a finance serving the economy. She also made an overview on the main EU regulatory topics of interest for the factoring industry, from the EBA guidelines on loan origination and monitoring, the definition of default and the Basel III implementation in the EU. Patrick de Villepin, Chairman of FCI, underlined that European factoring represents more than two third of the worldwide turnover, providing a bulk of services for SMEs: financing, guarantee against insolvency and cash collection.
Alban Maggiar, President of SMEunited, tackled the difficulties EU SMEs are currently experiencing. In June 2020, 80% of SMEs reported a loss of turnover due to lockdown and other crisis measures and 40% of them reported liquidity problems. In that context, the relevance of factoring as tool of finance for SMEs is highly welcomed as it contributes to liquidity and increases cashflow. He also called for pursuing the cooperation between all stakeholders to get the best financial solutions for SMEs.
Andrea Beltramello presented the EU Commission’s initiatives to foster liquidity and ensure productive capacity in tough economic times (first during the pick of the COVID-19 crisis and then today in this “recovery” time) which is essential for SMEs and their staff. He explained the key would be to strengthen the economic resilience of the EU and to make the recovery as fair and inclusive as possible via the diversifications of the sources of funding.
Theses interventions were then tested against the real-world experience of three SMEs or Companies operating with SMES, coming from Germany (Paulus Korste - Crombeen GMBH), France (Sebastien Celeri - Architect), and Italy (Paolo Lualdi – CFO Cremonini SpA). They talked about their operational challenges in obtaining funding and how factoring had provided an effective solution.
At the end of the workshop Fausto Galmarini thanked all the panelists for their effective contribution to the discussion and underlined the need of an actual support from the Governments and the Regulators by means of measures coherent with the importance of the SMEs in the real economy and the role played by the Factors for their funding.
The link to the recorded event is available by clicking on this link.