Factris will soon dominate SME financing in Europe. Here’s why.Go to the news page
Why can such a bold claim be made with such certainty? One simple reason - Factris’ advantage over the competition.
Gaining people’s trust and loyalty isn’t easy; whether it’s a teenager looking to their parents for more freedom or a fintech company looking to finance small businesses, it really comes down to having specific reasons to believe in a positive outcome.
More and more, people are turning to Factris for their financing needs. Moreover, that success will only continue into the future. Why? What indicates that Factris will soon be the leader in European SME financing?
Here are three specific reasons to believe the future belongs to Factris:
The competition has it wrong
Let’s just make one thing clear: people are loyal to things like communities and sports teams. They’re not as loyal to financial companies. So the reason a customer will choose a financial company is that the company offers the greatest advantage the customer, along with other reasons such as an easy application process or how the customer is made to feel about the company.
So why would a customer choose Factris has over their competitors? Because they offer greater value than their competition.
Most of Factris’ competitors (Unsecured lenders like Funding Circle, Zopa, Iwoca and SpotCap) focus on the tech side of things, putting their energy into creating complicated risk-algorithms and occasionally developing friendly customer-onboarding.
However, creating a successful fintech company involves more than just algorithms and smiles from their sales team.
What is needed is an established ability to scale a business with a clear profit margin, along with assurance beyond a personal guarantee. Does Factris have this? Yes. Does the competition? Nope. This is due to their competitor’s inferior financial formula in comparison to Factris.
With default rates (bad debt) of three to four percent, there’s a fair amount of risk associated with these other financial companies. Pair this with three to four percent per annum going to funders, and these companies have starting costs of seven percent before they start contributing to salaries, rent, etc. Combine this with a 12 percent market cost to customers, and it’s easy to see that their profit margin simply won’t put them ahead in this competitive market.
Clearly, there’s a number of things that are off with the competition. So what makes Factris so superior?
Factris cuts the fat
Compared with the competition, Factris is lean and mean. How so?
Look at Factris’ minuscule amount of bad debt: half of one percent …and dropping. That means that Factris is unencumbered by default rates compared to the competition. Also, with improvements from technology and risk-management solutions, this is expected to continue to drop by half in the coming years. Furthermore, as a securitised lender having liquid collateral, Factris can expect to get down to below one percent on funding cost at scale in the current lending environment.
So who would you say is in a better position so far? The competition, automatically parting with seven percent because of their financial formula? Or Factris, who parts ways with just one to two percent in comparison, including the cost of insurance?
Clearly, Factris is far more financially nimble compared to their ponderous rivals.
However, Factris’ advantage over the competition doesn’t just come from better economics. They also have the power to be more profitable, and the know-how to deliver it into the hands of their customers.
Greater profits and customer experience with Factris
It takes more than just being able to avoid danger and debt to take the lead in European SME financing.
That’s why Factris isn’t just about streamlining; they take their financial agility and pair it with another winning feature: their ability to make lending significantly more affordable than their competition- up to 30 percent less than other lenders- while still having a larger profit margin.
That benefit is striking to customers, which will continue to make Factris far more appealing than their competition.
However, it’s not just a cold, calculated experience for the customer. Factris is able to deliver all of these benefits with a personal touch; it’s never a “one size fits all” approach, but rather every customer receives a unique experience that’s customised to their specific needs.
As they’re personally guided through the application process with each service explained, they come to benefit both financially and personally. They receive peace of mind through understanding the process from beginning to end.
Because the focus is not just to provide financial solutions but also to gain the trust of each customer, this helps them to see whom to turn to when in need of future financing.
It’s clear Factris isn’t just ahead by a nose; they’re head and shoulders above the competition with their superior financial formula, making them significantly more affordable and valuable - all delivered with a personalised experience, tailored to the customer.
Taking these factors into consideration, it’s only a matter of time before “SME financing” and “Factris” become synonymous.
Factris closes series A round to increase reach
Factris has concluded a EUR 5M Series-A equity funding round led by AB Ventures, the corporate venture capital arm of the Arab Bank. Current investors participating in the round included Speedinvest and Optima Investments, along with high networth investors.
Factris and NN Investment Partners agree on European financing agreement
Factris has closed a new EUR 50m secured financing agreement with asset manager NN Investment Partners (NN IP). The facility will be used to provide financing to European SMEs via the purchase of their trade-related invoices.
What is factoring?
Alternative forms of financing, like factoring, have never been more important for your business. Learn how factoring works for your SME. Factoring (or invoice financing as it’s also known) is well known to many businesses.