Although still far from the volumes handled by the discount of promissory notes or deferred payment checks -between 7 and 10 times more, respectively, according to MAV data for 2022-, the projection is that the gap will continue to narrow in the coming years.
This is due to the fact that, unlike checks, the professional or SME that discounts a credit invoice accesses a very similar rate, but without running with final payment responsibilities or consuming bank credit in doing so, since it is the great company that must respond in last instance.
It is estimated that more than 220,000 small and medium-sized companies issue close to $1 billion in electronic credit invoices each month to 1,220 large companies in Argentina, so the margin for forward growth is large.
What are the factors of growth
The main factor that prevents greater dynamism, specialists agree, is the lack of knowledge of the majority of SMEs about the financial possibilities of the FCEM.
“The instrument is known as a billing tool, but most SMEs have no idea that with two clicks they have the funds in the day. Due to lack of dissemination, they end up paying a much higher financial cost than what they could access if they discounted the bill”, told Télam, Hernán Visconti, executive director and founder of Bill Group.
In this sense, he assured that fintech platforms have a key role in dissemination, since, although the MAV “offers trading and settlement with a very robust process, it does not give it the boost it needs to grow.”
“Fintechs add value to SMEs, with reports so they can make better decisions and advice on which invoices will give them a better rate, which allows them to advance liquidity to buy merchandise or supplies,” Visconti said.
What is the expectation of fintech
The expectation of the fintechs dedicated to advising and discounting these instruments is that in 2023 the volume of operations will grow by 175% to $120,000 million, according to a report presented by the Argentine Fintech Chamber, based on data from Caja de Values.
That’s because any small or medium-sized business, including self-employed professionals, consultants, or advisors, who issues an FCEM can discount it, regardless of their credit score or billing level.
In addition, being classified as an “SME product”, the FCEM allows access to preferential rates without affecting its current credit lines.
“The line of credit to discount checks that an SME has is tied to a relatively small volume. In contrast, with the credit invoice, if you have a line of credit of, for example, $2 million, but you invoiced a sale of $ 10 million with FCE, your line of credit does not limit that you can discount it”, explained Bruno Cosentino, executive director of Invoition.com.
Another relevant factor is that to open an account on a platform and operate with credit invoices “the balance, the credit or pension situation, or the qualification as an SME does not matter, but what matters is the qualification of the payer, which are all big companies like YPF, Arcor, Unilever and others”.
“That is why the instrument is very powerful, because it injects strength into the capacity to produce or finance any MSME,” added Cosentino.
Although SME instruments are traded through the MAV, fintech platforms are empowered to sell these securities directly to banks or non-financial credit providers, such as financial institutions, mutuals, and cooperatives that seek to safeguard liquidity in instruments with a good profitability-relationship. risk, since the final payers of the invoices are large companies.
“In the next 3 to 4 years, the FCEMs are going to replace, practically in their entirety, the first-line check discount operations. Large companies are clear that it is more convenient to accept invoices than to pay by check,” said Pablo Sanucci. , president of Invoitrade.
He affirmed that “the application authorities still need to reduce the term for acceptance of invoices to the 15 days established by law, instead of the 21 days currently in force”, and considered that “this will allow companies that pay 30 days also give their suppliers the opportunity to discount the instrument”.
Although he said that it remains for large companies that choose to cancel invoices with deferred payment checks to be able to modify their payment systems, since “today they have complex accounting systems,” many “are already changing it.”
“Every large company understands that it is much more beneficial for its value chain to have an accepted invoice that can be negotiated without endorsement, without guarantee of payment by the supplier, than to have a check that forces the supplier to consume its bank line,” Sanucci stated.
Source: Ambito
