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The Hidden Player in trade finance in Europe: invoice finance

New Research from Demica showed that the invoice finance market in Europe is worth over €1 trillion. They conclude that invoice finance is becoming an increasingly significant source of working capital funding as availability and lending conditions for relationship credit remain tight in Europe.

Demica's research reveals that the aggregated European invoice finance market was estimated to be €1090 billion (£892 billion) in 2011, compared to €991 billion (£811 billion) in 2010 and €844 billion (£690 billion) in 2009. This constitutes a compound annual growth rate of over 10%.

The invoice finance market has therefore become an economically significant source of business finance. It is equivalent to some 8% of EU 27 total GDP, represents more than 8% of EU 27 total corporate lending, and is approximately five times the size of the European leasing market in 2011.

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