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Non - Banking Financial
Markets

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In 2018, the Authority launched a draft law that combines financial leasing and factoring activities into one law. Both the parliament and the Cabinet of Ministers approved the draft law. The new Law will enhance financial inclusion and ensure access to non-banking financing tools to segments of society that currently do not benefit from a number of financial services.

Factoring is one of the pillars that provides working capital and accelerates its cycle, particularly in allocating short-term financial rights.

The total number of companies registered at the Authority and engaged in financial leasing activity reached 228 companies by the end of the year. In addition, the total amount of finance granted by these companies amounted to 41.6 billion EGP by the end of the year compared to 28.6 billion EGP in 2017 with a growth rate of 46%.  It is worth mentioning that 75% of the said amount directed to finance the acquisition of land and real estate required for productive projects, whereas the remaining amount directed to finance machinery, equipment and production lines. The results show that the value of these contracts is five times more than the value in 2014 of 7 billion EGP, which reflects the development of the activity and the dependence of companies on it as a mechanism for asset financing.

The sector is expected to witness growth in the coming years, especially after the launch of the Egyptian Collateral Registry, Which witnessed a turnout since its launch in March 2018. This will also have a significant impact on facilitating and encouraging financing operations especially for small and medium enterprises, besides, introducing micro-financial leasing in accordance with the new draft law on financial leasing and factoring.


Factoring market in Egypt is a promising market. The value of factored securities has almost tripled over the past four years, rising from 3.7 billion EGP in 2014 to 10.6 billion EGP in 2018. It rose by almost 18% compared to last year amounting to 8.9 billion EGP.