Current trends in the development of factoring services in Ukraine and worldwide
Journal Title: Економіка. Фінанси. Право - Year 2018, Vol 12, Issue
Abstract
The article establishes that factoring services manifest a positive development trend as an efficient reinvestment instrument. The objective of the article is to research theoretical foundations of the development of factoring in Ukraine and around the world. The paper provides an elaborate analysis of economic sectors within EU member states that make largest use of factoring services. In the UK factoring is not maintained by manufacturing companies, wholesale and retail companies and service companies. The biggest demand for factoring services in Denmark is observed in textile industry, in Greece – in food industry, in Austria – in processing and chemical industry. The article considers the problems and prospects for the development of factoring in Ukraine. The study determines key advantages of using factoring for economic entities. The trend towards the growing interest in the factoring services in Ukraine is observed. It is stipulated by the aggravation of the competitive activity in the market of factoring services between the banking institutions and factoring services companies. Further to it, small and medium businesses generally tend to have a quality debtor portfolio and strive to work with large purchasing customers. Factoring operations are commercially advantageous for business entities due to the possibility to decrease the costs of managing bad debt obligations and to build up own assets. The realization of suggested propositions related to the efficiency improvement of factoring management is a viable instrument of profit maximization for the enterprises. Despite an active development of the factoring services in Ukraine, there still exists a string of limiting factors, such as political instability in Ukraine, lack of confidence on the part of entrepreneurs with regard to the mechanisms of factoring, increase in the product cost, associations with the credit and complications of the document workflow.
Authors and Affiliations
Olena Volodymyrivna Poshyvalova, Maryna Oleksandrivna Mykhalochkina
Keywords
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