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Mapping Milan Fintech

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Italy is a country of 4.3 million small businesses, and most of these businesses have constant cash flow problems. 6 Unique Opportunities in the Italian Economy: SMEs, Payments, and Private Wealth Because of their ties with the financial sector, fintech founders were well versed in the market opportunities available in the Small and Medium Enterprises (SMEs) space, counting 4.3 million businesses in Italy, among which 4.1 millions are small (i.e. below 10 employees) 7 . Several SMEs have cash flow problems linked with payment time, which, according to official government data, range between 70 and 80 days. 8 Experts interviewed for this study typically quoted a timeframe longer than 90 days, especially when working with the Public Administration. With around €180 billion bank loans and bonds funding mostly reserved to medium-size companies, small and micro companies show stagnant growth in financing and appear to be largely underserved by traditional financial institutions. 9 In this inconvenience, fintech company founders were quick to recognize the opportunity to facilitate the waiting period with online factoring services. 10 Others tapped into the opportunity to convert Italian customers to credit cards. 85 percent of point of sale operations still take place in cash in Italy, but the rate of adoption for other payment methods like credit cards and e-wallets is growing twice as fast as the European average. 11

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