Romanian SMEs’ need of capital amplified during the pandemic: the financing offered by Instant Factoring, increase by 90%


More than half of Romanian SMEs have encountered problems in collecting invoices in 2020, which has led to an increase in the need for market financing, according to a study conducted by the National Council of Small and Medium Private Enterprises in Romania. In this context, Instant Factoring, the first Romanian fintech that offers online factoring services, registered a 90% increase in the volume of financing offered, from 40 million lei in 2019 to 77 million lei in 2020.

“In 2020, the pandemic put huge pressure on small and medium-sized businesses, which have often faced serious cash flow problems. We received for analysis over 5.000 applications, and the average value of the invoice accepted for financing was 3.063 euros. Through our platform, the applications were analyzed quickly, and many businesses received in less than 24 hours the necessary support in order  to be able to pay employees’ salaries or production raw materials, thus managing to continue their activity in this difficult period “, said Cristian Ionescu, CEO and co-founder of Instant Factoring.

According to estimates, the coronavirus pandemic determined in 2020 the increase of the average payment term of the invoices in Romania. Thus, it exceeded 120 days, compared to 115 days in 2019, the level being double than the European average and the value recorded 10 years ago.

,,Because the need for alternative sources of financing is very high on the Romanian market, we aim to increase by 300% the volume of financing granted in 2021. A priority is to develop the online platform by adding new features to improve the customer experience and streamline internal processes and flows so that any company can receive the answer to the financing request as soon as possible”, said Cristian Ionescu, CEO and co-founder of Instant Factoring.

According to the latest report published by the European Commission on the evolution of small and medium enterprises during 2018-2019, Romania is still in last place, with 30 SMEs per 1000 inhabitants, half the European average. The analysis made by the Romanian Association of Banks shows that only 100,000 Romanian micro-enterprises out of the approximately 550,000 existing ones have accessed a loan, which means that 4 out of 5 SMEs are non-bankable.

The online financing solutions offered by Instant Factoring are aimed at small and medium-sized companies that cannot or do not want to access a classic form of lending. The platform allows the analysis of applications within 2 hours, and in a maximum of 24 hours the client receives the money in the account, the entire analysis process being flexible and transparent.

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