The first client to receive financing under the «Affordable Factoring» program at JSC «COMINBANK» was the energy service company LLC «ARMATOK», which carries out restoration, thermal modernization, and insulation of educational institutions, kindergartens, and hospitals.
The energy service mechanism, or ESCO contract, has been in operation in Ukraine since 2015. It works as follows: energy service companies (ESCO companies) implement energy-efficient measures and develop renewable energy in public buildings and municipal enterprises with their own or borrowed funds on the terms of an energy service agreement.
«Energy service is a business that requires significant capital investment but has low margins. At the same time, energy service is precisely an effective tool for restoring buildings of social sector institutions belonging to local communities. Therefore, ESCO companies, in our opinion, belong to the category of enterprises that need special support from the state», – comments Dmytro Chornyi, Director of the Department of Factoring, Documentary Operations and Trade Finance of JSC «COMINBANK».
We remind you that the Entrepreneurship Development Fund, together with partners and the Government, is expanding the range of financial instruments for entrepreneurs of Ukraine. In December last year, the Ministry of Economy of Ukraine and the Ministry of Finance of Ukraine, within the framework of the State Program for Supporting Ukrainian Entrepreneurs «5-7-9%», officially launched the «Affordable Factoring» program.
JSC «COMINBANK» became one of the partner banks with which the Entrepreneurship Development Fund concluded cooperation agreements.
The program provides for compensation of the interest rate under factoring agreements to the level of up to 13% per annum for subjects of micro-entrepreneurship, small and medium-sized entrepreneurship.
According to ComInBank experts, the launch of the Program will contribute to an increase in the number of enterprises using factoring, which will lead to growth in the volume of factoring services in the country.
«The opportunity to receive factoring services at a relatively low rate will make factoring more accessible for producers. Now this instrument can be used by clients of those sectors of the economy that previously did not do this due to the relatively low margin of the business. For example, those producers who are in rather difficult conditions: on the one hand, buyers — large retail networks — demand cooperation terms with significant payment deferral, and on the other hand — the high cost of financing to provide the expected payment deferral period», — emphasizes Dmytro Chornyi.
Today, the demand for factoring from «JSC «COMINBANK» is driven by a number of advantages, among which are:
- Flexibility of decision-making;
- The possibility of adapting factoring to the peculiarities of business processes of a particular client;
- The possibility of cooperation with certain categories of debtors.
Now these advantages are joined by the possibility of receiving State support through compensation of the interest rate.
