A year-long study by Stichting MKB Financiering, a think tank covering the alternative finance market, is reporting that SMEs raised €2.7 billion in The Netherlands in non-bank financing. The group states that the data proves that alternative finance has gone beyond the experimental phase “securely positioning itself within the SME financing market.”
Ronald Kleverlaan, chairman of Stichting MKB Financiering, commented on the study:
“A growing number of Dutch entrepreneurs have gained experience with new SME finance providers in 2019 and previous years. One out of five entrepreneurs was able to find these new financiers, who showed their added value during the recent coronavirus crisis.”
Overall, alternative finance grew 26% in 2019 versus the year prior (at €2.15 billion). Over € 2.7 billion in newly granted funds and every fifth SME is financing their activities alternatively.
Moreover, the data indicates that the number of financings grew by a whopping 41% to 49,120 – last year this number was 34,892. Stichting MKB Financiering believes these alternative ways of financing for small business fundings up to a million euros proved to fulfill a clear market need.
The metrics for alternative finance for 2019 in Netherlands include:
- 49,120 companies used alternative financing in 2019 (41% growth)
- Alternative finance grew to € 2.7 billion in The Netherlands
- Small business financing (< € 1 million) grew to 22% of all SME financing
- Real estate financing more than doubled in 2019
- Lease financing and factoring accounted for 74% of alternative finance
Of note, the research is pre-COVID and the pandemic and affiliated lock-down in the Netherlands will certainly impact the growth of the non-bank financing market this year. But Kleverlaan believes the trend regarding alternative financie for a growing numbers of SMEs financing will continue in the coming years and the non-bank financiers will take over the role of the banks by 2023.
The full report (in Dutch) with tables and graphs per category of alternative finance is available here.
Netherlands SMF_Alternative Finance_Report_Sheet_2019