Factoring Sector in Turkey: General Overview and Evaluation of Factoring Companies' Financial Performance by Multi-Criteria Decision-Making Techniques

Abstract

The factoring sector, which plays a key role in the sustainability of cash flows for businesses, particularly small and medium-sized enterprises (SMEs), offers a range of financial services, most notably the conversion of receivables into cash before their due dates. Today, this sector is regarded as one of the most significant components of the non-bank financial segment. Thus, the condition and performance of the factoring industry are crucial for the sector's future and the overall functioning of the financial system. The purpose of this study; to evaluate the general situation of the factoring sector in Türkiye, its position within the global factoring sector, and the financial performance of companies operating in this sector. In line with this objective, initially, a general assessment of the sector's overall situation was made based on cumulative data related to the sector. Subsequently, the financial performance of companies operating in the sector was evaluated for the 2021-2022 period using six criteria identified for examination, weighted both through the equal weighting method and the CRITIC method, and assessed using the MAIRCA and MABAC methods. According to the analyses conducted, the rankings of financial performance remain unchanged using the MABAC and MAIRCA methods. However, when the criteria weighting method varies, partial changes in the rankings of factoring companies' performance occur.