Yury Kralov: factoring on the SupplierPlus platform is a win-win solution for everyone

Chairman of the Board of PJSC MTB BANK Yurii Kralov took part as a speaker in the online conference "SupplierPlus: the start of modern factoring in Ukraine", where the Estonian company SupplierPlus officially presented its reverse factoring platform in Ukraine.

«SupplierPlus is an online platform that operates with digital documents, uses automatic data exchange and electronic signatures.  Therefore, suppliers receive  access to a source of working capital,  sell invoices at will, and when needed, receive up to 100% of the invoice immediately after the sale. Buyers, in turn, work with longer payment terms without harming suppliers», – noted the chairman of the board of PJSC» MTB BANK» Yurii Kralov.

Yurii Kralov stressed that  that the official launch of the reverse factoring platform – this is a significant event for Ukraine:

«Today factoring – global trend, this tool works effectively in developed economies, and our country has great potential for its application. It is very important that the process of implementation of this financing instrument is initiated and supported by the National Bank of Ukraine,  by the International Finance Corporation (IFC), the EBRD and USAID within the framework of their "Transformation of the Financial Sector" project. MTB BANK – one of the first banks of Ukraine to join the SupplierPlus platform and we are interested in the banking community and companies also joining the platform as soon as possible and using it as a tool for prompt and easy attraction of additional working capital financing.

It should be noted that MTB BANK has already taken a number of steps in the field of development of factoring services in five years, and today its market share is 3%. This is quite a large number, considering the fact that modern factoring services are not sufficiently developed in Ukraine.

Uwe Poom, COO of SupplierPlus Group, noted that buyers with a good credit rating can free up their working capital and suppliers can in turn get paid instantly:

" One of the main advantages of reverse factoring – quick refund on invoice.  If the usual factoring is aimed at the supplier, and the buyer bears no responsibility, then the reverse – this is an inverted version of the same idea, but the focus is on the buyer. A line of credit can be provided to the buyer, and it guarantees the supplier that invoices will be paid promptly. In this case, the buyer must provide documents to the bank that he is solvent.

«Factoring, and especially reverse factoring, is a low-risk and effective tool for expanding SMEs' access to financing. We are happy to support the company "SupplierPlus Ukraine", which makes factoring affordable for small and medium-sized businesses. We hope that in the coming years the factoring market will grow from today's 0.2-0.3% of GDP to at least 5%, and Ukraine will approach its Western partners in the level of development of trade financing. - emphasized the head of the USAID project "Transformation of the financial sector" Robert Bond.

During the conference Oleksiy Oniper, the general director of SupplierPlus in Ukraine, emphasized that "reverse factoring– it is much more effective  cost and margin management tool".

In addition, Yurii Kralov emphasizes, «the factoring that exists on the market now does not allow small and medium-sized businesses to develop faster.  The main obstacle is related to the fact that clients must "bring" the bank has the entire contract, and the financing is implemented in full. This is not very convenient for entrepreneurs, because all receipts must go through one bank.  Thus, the freedom to choose the best financing conditions is limited.

«The new solutions give the supplier the opportunity to top up his working capital partially, exactly as much as he needs now, and at any bank. He can sell one, two, or three invoices to any financial institution, while remaining a client of the bank where he is already used to being served," Yuriy Kralov noted.

Conference participants expressed confidence that the Ukrainian market can quickly adopt reverse factoring, because suppliers, buyers and banks are interested in new digital technologies. The third wave of Internet technologies – blockchain, which involves the use of  electronic signature,  will contribute to the spread of e-factoring on the Ukrainian market.