Introduction to Amsofac and its Role in SME Financing
The Mexican Association of Factoring, Credit and Leasing Companies (Amsofac) emphasizes the importance of specialized financing to address small and medium enterprise (SME) liquidity issues amidst global supply chain transformations and the government’s efforts to expand credit access through Plan México.
Who is Amsofac?
Amsofac is an association comprising over 50 financial entities, including both regulated and unregulated leasing companies. The organization aims to promote and support the growth of specialized financing options for SMEs in Mexico.
The Significance of Specialized Financing for SMEs
According to Álvaro De Garay, vicepresident of Amsofac, financial tools are crucial for SMEs, regardless of whether their supply chains are domestic or international. He highlights the need to support entities within these chains for improved liquidity, better cash flows, and the ability to navigate payment terms.
Factoring as an Effective Solution
Among specialized financing options, factoring has emerged as one of the most effective solutions for SMEs. This instrument allows companies to access immediate resources without waiting for their invoices’ due dates by selling accounts receivable.
Benefits of Factoring for SMEs
De Garay stresses that factoring enables SMEs to remain active in production chains, irrespective of whether these chains operate domestically or internationally. Moreover, it enhances their growth potential.
Growing Involvement in Factoring
The vicepresident notes that more companies, including large leasing firms, small businesses, and fintech startups, are entering the factoring market.
Strengthening Capacity through Training and Standardization
To expand financing capacity for SMEs, De Garay explains the necessity of bolstering the funding received by Amsofac’s member entities.
Internal Training School
Amsofac is promoting an internal training school to standardize information generated by its members and encourage best practices within the sector. This initiative aims to strengthen relationships between member institutions and development banks, positioning Amsofac as a relevant actor in the government’s strategy.
Increased Reliability and Awareness of Financing Options
By implementing these actions, Amsofac enables financial intermediaries to serve their clients more efficiently while establishing themselves as reliable institutions among funders.
De Garay emphasizes the importance of increasing awareness and utilization of financing options such as credit, leasing, and factoring among SMEs, particularly since the benefits of leasing and factoring are less known.
Key Questions and Answers
- What is Amsofac? Amsofac is the Mexican Association of Factoring, Credit and Leasing Companies, an organization that supports specialized financing options for small and medium enterprises (SMEs).
- Why is specialized financing important for SMEs? Specialized financing, such as factoring, addresses liquidity issues faced by SMEs amidst global supply chain transformations and government efforts to expand credit access.
- What are the benefits of factoring for SMEs? Factoring enables immediate access to resources, supports SMEs’ participation in production chains, and enhances their growth potential.
- How is Amsofac promoting specialized financing options? Amsofac is strengthening member funding, standardizing information, and encouraging best practices through an internal training school to increase reliability and awareness of financing options among SMEs.
