Factoring as a form of financing small and medium-sized enterprises in Serbia

Bradić-Martinović, Aleksandra and Nedović, Nemanja and Balaban, Mladenka (2015) Factoring as a form of financing small and medium-sized enterprises in Serbia. In: New еconomic policy reforms. Belgrade Banking Academy, Belgrade, pp. 344-356. ISBN 978-86-7852-036-5

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Abstract

Development of small and medium enterprises has an effect on economic growth and that is especially important in the case of open economies. Survival, growth and development of small and medium enterprises are primarily determined by the possibility of financing from affordable sources. Limited access to external sources of financing, on the money and capital markets, especially regarding the price and terms of use, is possibly the most important characteristic and the biggest problem of these enterprises. The goal of this paper is to show factoring as one of the possible alternatives which could overcome the limitations in small and medium enterprise funding. Global trends indicate that the volume of factoring increases from year to year, at an approximate rate of 20%. The factoring market in Serbia has grown steadily during the last six years, with 30% an average annual rate of growth, with currently 21 factoring market participants (10 banks and 11 factoring companies).

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