Leasing is the most popular form of financing for SMEs. Are we moving away from loans? (TEST)

Luc Williams

According to the study authors Kaczmarski Group2024 from the perspective of micro, small and medium-sized enterprises“, a bank loan is no longer the most frequently chosen form of external financing by companies.

Bank loans are becoming less and less popular

High interest rates in 2023 significantly discouraged companies from using bank loans. Therefore, now they will be more willing to look for other sources of financing. Especially those that do not carry the risk of changes in interest rates,” noted an expert from the factoring company NFG – Emanuel Nowak.

The study shows that the most popular solution chosen by companies in 2024 is: SME sectorIs leasing. “Every fourth entrepreneur surveyed (24%) indicated this form of financing as their preferred one,” the authors of the study reported. They added that the greatest interest in leasing is shown by companies from: construction industry and production (34% each). They also added that this trend is reflected in the latest data Polish Leasing Association. They show that Poland is the 5th largest leasing market in Europe and over the last 10 years it has also been the fastest growing in European Union.

Sole proprietorship companies rely on installments

The study also showed that they are the second most popular form of financial support after leasing installment purchases – “18 percent of companies intend to use them this year.” “The majority of supporters of this solution are sole proprietorships (19% compared to 17% of companies). (…) They see this solution as an opportunity to cover small company expenses without having to get involved in long-term contracts and the obligation to buy out the leased item after the end of the financing period,” experts noted.

As the Kaczmarski Group study showed, only 16% of people are currently interested in a bank loan. companies from the SME sector. “At the end of 2023, 18.1% of the value of loan liabilities micro-enterprises were delayed by over 90 days, which was the worst result in five years,” experts said.

Loans win in stable companies?

“The interest in loans in medium-sized companies (employing 50-249 employees) and those with a long experience on the market (over 10 years) is greater than in other segments,” noted the authors of the study. They explained that they prefer bank loans because of the conduct long-term investmentsthat require “stable” sources of financing. “In 2024, every fifth medium-sized company will decide to take out a loan, and the dominant industries are transport (20%) and trade (19%),” they said.

Factoring and long-term equipment rental are also often chosen

Experts indicated that also factoring and rental of machines, devices and vehicles are popular with entrepreneurs from the SME sector. “In 2024, 13 percent of companies are planning this solution,” they added.

They pointed out that according to the data Polish Association of Factors in the fourth quarter of last year factors financed 26.8 million invoices worth PLN 450 billion. Thus, they served 26.3 thousand. companies (6% more than a year ago). “The long-term car rental market can also boast similar growth. Polish Vehicle Rental and Leasing Association reports that the growth dynamics of this market in Poland has been continuously stable for years at a level of approximately 9 percent,” the study indicates. “Today, long-term rental is increasingly chosen by the smallest entrepreneurs,” they said.

According to experts, the forms of financing vary depending on the size of the company, the specificity of the industry and the length of operation on the market. “This year, sole proprietorships will focus on installment purchases, and companies on leasing. Medium-sized companies and those with a long experience on the market will still be willing to take out bank loans,” concluded the authors of the study.

Kaczmarski Group informs that it deals with the verification of potential contractors, ongoing business risk management, providing financing and recovering receivables amicably or in court.

Part of the Kaczmarski Group's activities also includes protecting consumers against fraud or their negative consequences. (PAP)

author: Anna Bytniewska


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