Taking Control of Italian SME Invoice Financing

Italian SME invoice financing

Italy is marginally smaller than the UK in terms of population (60 million vs. UK’s 65 million), and even in terms of GDP ($1.85 trillion vs. $2.69 trillion), Italy is not far behind. Italy has 6 million businesses, out of which 4 million are SMEs. Traditional lenders have not been able to serve these SMEs, […]

Italian SME invoice financing

Italy is marginally smaller than the UK in terms of population (60 million vs. UK’s 65 million), and even in terms of GDP ($1.85 trillion vs. $2.69 trillion), Italy is not far behind. Italy has 6 million businesses, out of which 4 million are SMEs. Traditional lenders have not been able to serve these SMEs, and neither has the alternative lending market developed to fill this gap. Italy is nowhere close to the UK in the peer-to-peer lending industry; as per AltFi data on European marketplace lending volumes, Italy accounts for a meager 0.27% share of the volume originated by the industry since inception, and the UK accounts for 84.80% of the share. With less than a dozen active players in the Italian P2P industry, there is a clear mismatch in terms of demand and supply. Understanding the size of the market opportunity, Anticipay has launched an invoice discounting platform that helps SMEs get short-term financing.

Anticipay: Introduction

Anticipay is headquartered in San Giovanni (MI), Italy and was incepted in May 2017. Initial equity has been pumped in by the founding members. But they plan to have a small capital raise by the end of the year and want to start customer onboarding at the beginning of 2018. The company’s main focus is to successfully bring on board SMEs and their invoices and find investors who will systematically start buying these invoices.

Founding partner Marcello Esposito holds an MSc/MPhil in Economics from the London School of Economics. Prior to this, he worked with leading Italian companies in the asset management sector. Steve Tendon, CTO and founding partner, holds a certificate in Fintech Innovation: Future Commerce from MIT and was a strategic advisor on the National Blockchain Strategy Taskforce in the Office of the Prime Minister. CEO and founding partner Jacopo Moresco previously worked as director at Infonet Srl. Founding partner Bruno Guerri was previously director of CSSB (now known as CSD – Directional Services Center).

Post-2008, financial institutions around the world became stringent when it came to lending, and the SME sector was the most affected. Considering the size of the Italian SME sector and only five participants in the alternative SMB lending segment, the overall market is still at a developmental stage with huge potential. Anticipay is more focused on growing the market and educating clients as compared to poaching business from its competitors.

What is Anticipay?

Anticipay is an invoice discounting platform that helps businesses get short-term financing in lieu of their invoices. SMEs can directly upload their invoices on the platform; Anticipay then evaluates the commercial value of the invoices and assigns a final score to the invoice(s).Once that is done, invoices are published on the platform with the final score for auction and investors have the option to buy the invoices at a discount. For now, it is concentrating on buyers from Switzerland and Italy only.

The technology used to develop the platform is entirely in-house and the team has used Elixir,a functional coding language known for allowing flexibility and scalability. Company is also looking for securitization options for faster cash flow realization. The company is evaluating revolving securitization and structuring a closed-end fund with a 5-year maturity.

The company will operate as a marketplace lender. Once they have a strong foothold, they want to offer services to the entire supply chain–from the initial supplier to the final client. This will enable the company to have greater control over the security (invoices), as it will have more in-depth information about the market and the stakeholders involved in the process.

Anticipay wants to establish itself as a competitive alternative to banks; therefore, the company will charge reasonable fees. Investors can expect to earn a yield in the region of 4%-6%. Considering the low-yield fixed income scenario in Europe, investors will find this a compelling investment. Though the yield will be market driven, the specific discount rate to be charged will be decided on the basis of the credit rating of the debtor.

Anticipay Customers

When it comes to its customers, Anticipay will start conservatively. They want to go after limited companies and SMEs with good credit ratings. But even in this segment, they prefer companies that issue invoices with public information. This allows them to have information about the transaction from both sides of the spectrum.

Industry Tailwinds and Focus Areas

The size of B2B invoice market is estimated to be €430 billion. Lack of short-term financing options means Anticipay has a massive market to target. Factoring revenues for lenders have risen by double digits in the last few years highlighting major tailwinds for the industry as a whole. They are currently concentrating on tying up with investors who can buy these invoices; they are also working with family offices and other clients to fund SMEs. The company will look to onboard institutional investors in the near future.

Anticipay is collating historical data for invoices and similar asset classes for creating an in-house database and track record.


Anticipay is trying to carve its own niche by doing basic things differently. Rather than targeting just individual SMEs or clients, they want to own the entire supply chain. This will reduce the cost of  client acquisition and will ensure deeper understanding of borrowers. They are also adopting a more direct commercial approach, which will have agents on the ground for face-to-face interactions. Anticipay has laid the groundwork to becoming an important player in the Italian SME financing industry.


Written by Heena Dhir.

Thursday September 1st 2016, Daily News Digest

Thursday September 1st 2016, Daily News Digest

News Comments Today’s interesting reads: Moody’s pointing out Prosper Marketplace successfully avoiding Madden vs Midland risk and new laws perhaps coming ; Amazon and Wells Fargo split up. In the UK : IFISA will open to bonds in Nov 2016. And more internationally: India will most likely get p2p regulation before Sunday; and interesting market overviews […]

Thursday September 1st 2016, Daily News Digest

News Comments

United States

United Kingdom


European Union




United States

Amazon and Wells Fargo part ways on private student loan deal, (Washington Post), Rated: AAA

(Amazon chief executive Jeffrey P. Bezos owns The Washington Post.)

Barely a month after teaming up, Wells Fargo has stopped offering Amazon.com customers discounted interest rates on private student loans.

Neither company would explain the abrupt end of the program, only confirming that it has been discontinued. The Wells Fargo Web page that once heralded the union now redirects to the bank’s run-down of its student loan products.

Until this week, Amazon Prime Student subscribers who applied for any of the bank’s education loans were eligible to have their interest rate lowered by half a percentage point. The deal was a bit unusual. Though it’s not uncommon for banks to partner with retailers to offer credit card customers discounts on shopping or travel, loans are another thing.

“We congratulate Amazon for deciding to stop promoting Wells Fargo’s costly private education loans,” said Pauline Abernathy, executive vice president of the Institute for College Access and Success (TICAS). “Private loans are one of the riskiest ways to pay for college, with none of the flexible repayment options and consumer protections that come with federal student loans. Students should consider other schools if a school requires them to take out a private loan.”

Moody’s: New efforts to bolster lender protections won’t eliminate legal risks for marketplace lenders, (Moody’s), Rated: AAA

Two recent developments in the marketplace lending space will be credit positive for some asset-backed securities (ABS) backed by marketplace loans, Moody’s Investors Service says in a new report. The moves, which reflect efforts to strengthen protections for holders of marketplace loans against legal actions by consumers, won’t eliminate this risk entirely, however.

“Some marketplace lenders have recently changed their origination model to address legal risks that could impair consumer loans whose interest rates exceed state usury limits,” says Moody’s analyst, Jody Shenn. “Meanwhile, newly proposed legislation, if passed, would create more explicit protections from state usury laws for bank-originated loans that are sold.”

Prosper Marketplace Inc. is the latest marketplace lender to adjust its origination model in the wake of the Madden v. Midland Funding LLC decision and other rulings, Shenn says. The changes strengthen loan holders’ ability to protect themselves against legal actions by consumers whose loans have high-interest rates but don’t completely remove this risk. Madden-like challenges, for example, could be heard by judges who are sympathetic to plaintiffs’ arguments.

Separately, US Representative Patrick McHenry has introduced a bill in Congress that would more explicitly protect bank-originated loans from state usury laws. If passed, the legislation would state that if a loan is valid when made due to the federal preemption of state usury laws, it would remain valid if it is then sold, assigned, or otherwise transferred.

“Such legislation would be credit positive for marketplace lending ABS because it directly addresses the Madden ruling and would prevent legal challenges based on the same theory,” Shenn says. “The bill is very narrow, however. It doesn’t resolve the issue of whether the bank or marketplace lender is the true lender of a loan, for example, which therefore is a separate legal risk for securitization transactions.”

Yirendai to defend against legal suits, (Shanghai Daily), Rated: A

Fifteen Chinese firms were sued in securities class action lawsuits in the US in 2015, taking up over 40 percent of all shareholder suits filed against US-listed foreign firms, research by Stanford Law School and Cornerstone Research showed.

On Tuesday, both New York and New Jersey-based law firm Bronstein, Gewirtz & Grossman filed a lawsuit accusing Yirendai of making “materially false misleading statements.”  On the same day Rigrodsky & Long PA filed a legal suit for the Central District of California against the P2P lender’s failure to disclose “rising fraud related to customer applications for its loan products,” and the negative impact that “the implementation of new anti-fraud regulations could have on Yirendai’s performance.”

Yirendai, the consumer finance arm of Chinese P2P lender CreditEase, yesterday rejected the complaints as “without merit” and the company intends to defend its interest.

Moody’s: Marketplace Lending is Good for Small Business Even as Pitfalls Remain, (Crowdfund Insider), Rated: A

Moody’s report in full can be found here.

Moody’s has published a report on the marketplace lending industry stating that platforms are “steadily expanding credit to small and medium-sized enterprises (SMEs) – but challenges remain. The authors are of the opinion that partnerships with traditional banks may ease the path forward for this segment of online lending.

Moody’s believes the new lending technology can help provide credit to SMEs while banks will benefit from access to the technology – including faster loan review – while expanding their relationships with customers.

The caveat to all of this is the looming risks of online lending and the list is challenging. Moody’s highlights model risk, regulatory risk, loan performance uncertainty and, yes, the risk from banks that are going it alone. With Goldman Sachs poised to enter the market in weeks, existing MPLs will have additional competition.

United Kingdom

Crowdfunded bonds: an income solution for ISA savers?, (City Wire), Rated: AAA

From November, the type of crowdfunded loans that will be authorized to sit within the new ISA will expand to include crowdfunded bonds. Unlike P2P lending, where investors’ money is spread among a large number of smaller loans typically made to small businesses and individuals, crowdfunded bonds see all of an investor’s money lent to larger, more established company.

The newest addition to the ISA stable, the ‘Innovative Finance ISA’, has been available since April. Currently, it allows peer-to-peer (P2P) lending investments to be held tax-free, such as loans made through lending platforms like Zopa, RateSetter and Funding Circle.

Julia Groves, head of crowdfunding at Downing and founder of the Crowdfunding Association, argued crowdfunded bonds were cutting out the fund manager middle-men and their high fees, meaning there were greater returns for investors.

Downing offered its first crowdfunded bond – investing in solar energy – at the beginning of the year at a fixed interest rate of 6.25%. It has launched eight bonds to date and is looking at launches next year that will enable investors to lend to care homes and nursery schools. Alongside solar investments, there is also a Pub Bond that offered 5.75% over 12 months plus a 20% discount card for investors in a chain of Home Counties pubs that is hoping to expand from its current four.

Downing is also seeing a boost from pension freedom, which has given over-55s the ability to be more flexible with their retirement savings.

Zopa doubles lending but reports £8.9m annual loss, (Financial Reporter), Rated: A

Peer-to-peer lending platform Zopa doubled lending to £532 million in 2015 but announced a 45% increase in annual losses from £6.1 million in 2014 to £8.9 million.

Zopa says the loss is due to “significant internal investments” throughout 2015. Headcount more than doubled, from 70 people in December 2014 to 157 in December 2015, and a focus on technology innovation combined with increased marketing activities stimulated the growth in disbursals and revenue.


RBI likely to agree on nodal agency, (Business Standard), Rated: A

The Reserve Bank of India (RBI) is expected to issue the final guidelines for peer to peer (P2P) lending in the next few days.

It is expected to concede to lending firms’ suggestion for a nodal agency.

Comment: I had to look up what a nodal agency means. Nodal means: at a place where lines, systems, or paths meet. I assume a nodal agency would mean an agency that reports to multiple government stakeholders. 

People familiar with the development say the final guidelines are expected to come out before he demits office on Sunday.

The entities also suggested they should be given access to credit bureau data, which could get approval. They say this will help improve the quality of borrowers.  Apart from structural guidelines, the rest would be more suggestive in nature. “This is because the sector is still evolving and they don’t want to clamp on it,” said one player.

Some had asked the minimum capital requirement of Rs 2 crore be relaxed.  While bigger entities wanted the amount to remain, smaller ones had reservations, saying they were not lending or accepting deposits, and it shouldn’t apply to them. Now the players are also expecting a clarification on this.

European Union

Marketplace Lending in Italy Still in Infancy but Long Term Potential is Promising, (Lend Academy), Rated: A

As of the latest available figures Italy accounts for a minuscule 0.27% share of the volumes originated by the industry since inception. True, the UK accounts for the lion’s share of the European pie at 84.80%, suggesting that marketplace lending in Europe is currently a tale of two markets: the UK, and “all the others”. But Italy’s share looks extremely low even in comparison with France’s 3.33% and Germany’s 5.55%. It is approximately one-third the size of Finland, a country whose population is over 10 times smaller than Italy’s.

Two new platforms have joined the segment of loans to individuals: Soisy and Younited Credit, the latter having clearly taken the lead in new monthly originations after only four months since launch thanks to the strong support of its French mother company (the former Pret d’Union).

Four more platforms have been established to provide financing for businesses. Two of these are already operating: Borsa del Credito (which focuses on medium-term (36 to 60 months) financing for micro-businesses and SMEs) and Work invoice, which as the name suggests is a marketplace for companies aiming at financing their business via the sale of some of their receivables.

Before the end of 2016, they will be joined by Instapartners, an initiative backed by an impressive team of former top consultants and well-known entrepreneurs and CashMe. Both newcomers will be focusing at least initially on offering short-term financing solutions to SMEs.

Data collected from sources such as Milan’s Polytechnic (publisher of an annual report on Crowdfunding which from this year also included “Crowdfunding Lending”) or our own site P2Plendingitalia.com (a specialist blog/site in Italian which collects monthly figures from all the platforms) are still very modest in absolute terms.

Italy is a market only marginally smaller than the UK, in terms of population (60 mn people vs the UK’s 65 mn) or measured by the size of its GDP. It is also home to over 6 mn businesses, of which 4 mil classified as “micro-businesses”. Finally, the pool of savings held by Italian households is huge. According to Bank of Italy’s data, total financial assets held by Italian households at the end of 2014 amounted to €3.9 tn (approximately $4.3 trillion) and total net wealth was estimated at €8.7 tn ($9.5 trillion USD).


Fosun chairman calls China’s P2P market a ‘scam’, (FT), Rated: A

China’s self-styled “Warren Buffett” and billionaire businessman Guo Guangchang on Wednesday called the country’s Rmb440bn ($65.9bn) peer-to-peer lending market “basically a scam”, becoming the latest high-profile executive to attack an industry that has been plagued by scandal.

The sector has been lauded for providing an alternative to low-interest deposits but has more recently gained a reputation for hosting some of the biggest scams involving retail investor cash in China’s recent financial history, incurring the wrath of some of the country’s top business people as well as the regulators.

Mr. Guo made the remarks at a press conference in Hong Kong following the release of the company’s interim results. Another Fosun executive emphasized that the company, known for using insurance premiums to make investments abroad, had never dabbled in the P2P business.

Earlier this month, the president of Ping An Insurance, China’s second-largest insurer, told the Financial Times that most P2P lenders were “fakes” and that the vast majority of China’s P2P lenders would not be able to continue their business in the future.

The president of Ant Financial Services, a subsidiary of Alibaba that houses the group’s payments and credit scoring platforms, has also tried to distance the company from China’s broader P2P lending market.

Mr. Guo has been no stranger to controversy himself. The Fosun chairman disappeared for several days in December, only to re-emerge claiming he had been assisting an investigation in China. The group subsequently walked away from a deal to buy an Israeli insurance company.


Indonesia’s Fintech investment to reach $ 8 b in two years: KADIN, (Deal Street Asia) ,Rated: A

The Indonesian Chambers of Commerce and Industry (KADIN) has said that the country’s fintech industry is expected to receive up to $8 billion (Rp 105 trillion) of investments by 2018.

“In 2008, fintech investment stood at roughly $ 900 million. It had increased to three billion in 2013, and is projected to reach $ 8 billion by 2018,” Roeslani said at the Indonesia Fintech Festival and Conference (IFFC).“

Southeast Asia’s largest market Indonesia has been witnessing an emergence of a number of fintech companies such as peer to peer lending company Modalku, mobile recharge platform Sepulsa, e-commerce financing company Kredivo, online micro-lending company UangTeman and many others.

Not long before that, Indonesian P2P marketplace Investree said it had secured a series A funding commitment from a local venture capital firm, Kejora. Details of the amount, however, were not disclosed.

Transactions through fintech in Indonesia are estimated to be Rp 40 trillion in the past two years, a rapid escalation alongside growth in internet usage in the country, with a third of its 250-million population going online. A fifth of that number, however, still have no bank accounts.

Around the globe, KADIN recorded that customers in the fintech sector in Africa have risen almost two times to 101.3 million users, from 57.8 million reported in 2012. North America has 90.7 million users, while Europe acquires 64 million. Latin America saw a growth of 162 per cent of users, while in the Middle East the number of users has increased more than 300 per cent. In the Asia-Pacific region, investment in fintech rose fivefold to $ 2.7 billion in the first three months of this year from the same period a year ago.

Karaniya Dharmasaputra, Secretary General of Indonesian Fintech Association said, boosting cooperation and increase connections among fintech companies in Indonesia are one of the strategic objectives of the association, as it can help improve public access to technology-oriented financial services.


George Popescu