News. Confirming (Reverse Factoring) from Alternative Financing as a complement to companies' financing lines.

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The facility commonly known as Confirming in Spain and Reverse Factoring in the rest of the countries, is the facility where the issuer communicates to its suppliers, through the technological means of its financial institutions (Banks and Non-Banks) about the conformity of invoices owed to them and offers them a liquidity facility against the credit risk capacity of the issuer.

Non-bank financing institutions have specialised in offering this product, maintaining the basic features such as non-recourse to the supplier and adding additional advantages.

  • Specialisation. By offering means such as highly specialised technological platforms that offer issuers and suppliers higher quality in the issuance, advance payment and payment processes (speed, traceability, timely reports, notices, detailed information).
  • No impact on CIRBE, which does not reduce the capacity for additional borrowing in other types of financing necessary for the company issuing the confirming (guarantees, short- and long-term credit).
  • The supplier uses the creditworthiness of his debtor, and thus does not use up his own creditworthiness in his banks.
  • Low administrative costs, and simplification of processes with online and 24/7 means. 
  • Diversification in the type of relationship finance institution 

In recent years, this facility has been increasingly used to finance companies' working capital needs. According to the Spanish Factoring and Confirming Association (AEF), confirming activity in Spain increased by 4.56% in 2020, while factoring products declined in use in the year when the pandemic began.

Given these data, the incorporation of a specialised non-bank entity such as Finalbion for the financing of working capital is an option that has already been taken by more than 100 business groups in Spain, having financed more than 1,000 million Euros to more than 6,100 suppliers in Confirming lines.