21 Apr The Dutch alternative finance industry in an international context
The Dutch alternative finance industry is doing well in continental Europe
The recent published European alternative finance benchmarking report ‘Moving Mainstream’ shows that the Netherlands are doing relatively well with regard to alternative finance. Compared to the UK and the US the Dutch volumes are really very modest. US is the global leader of the pack and the UK is definitely leading the way in Europe. But with a volume of €78M being raised by alternative finance the Netherlands are fourth in continental Europe, following France, Germany and Sweden. In volume per capita the Netherlands even rank third, after Estonia and Sweden.
High density of crowdfunding/p2p platforms
There are many active platforms in the Netherlands. 31 of them are official registered by the Dutch Authority on Financial Markets. This shows that there is much willingness in the Dutch market to take alternative finance as a serious option. However, it also can have the result that because of a lack of scale these platforms are unable to really invest in state of the art technology
Alternative financing of SME’s
Especially with regard to P2P business lending the Netherlands are performing above the average of continental Europe. €35M of the total volume of €78M, being 45%, consists of P2P business lending. In continental Europe this share is only 15%. P2P business lending is important because it is an instrument to fill the finance gap by traditional banks. The finance of SME’s is severely hampered due to lengthly turnaround, uncertainties about results and high management costs of regular banking processes. With P2P lending on online platforms these obstacles are largely removed, making it an attractive alternative for bank financing.
Trade finance is relatively unknown as means of financing SME’s
Trade finance as a means of financing SME however is a relatively unknown part of the alternative finance industry in the Netherlands. With trade finance firms sell their invoices or receivables to a pool of individual or institutional investors. Trade finance differs from traditional factoring because of the use of online platforms that enable larger groups of participants and increase flexibility.
Read more about the Dutch alternative finance landscape in the international context: full article in Dutch
On Crowdfunding Day 2015, the largest crowdfunding congress in Europe, Holland FinTech will address the question how trade finance can be used in addition to the more well known forms of alternative finance, like crowdfunding and P2P lending. Holland FinTech gives the floor to the Dutch finance companies Trefi, Pro Liquidity, and Flinqer to share there insights on this with the audience in an interactive session.
Crowdfunding Day 2015 takes place on May 12th in the Amsterdam Arena. Register here
