Bancomext programs support domestic Mexican automotive suppliers
Strengthening the participation of domestic Mexican automotive suppliers in the nation’s growing industry supply chain is the goal of Bancomext programs.
Since December of last year, Mexico’s Banco Nacional de Comercio Exterior, or Bancomext, has granted credits of more than three billion dollars with the objective of supporting the participation of domestic Mexican automotive supplier participation in the growth of the nation’s industry.
In a recent press conference, the director of financial intermediation of Bancomext, Arturo Sojo-Quiroz, that one form of support of domestic Mexican automotive suppliers has come in the form of “factoring.” Factoring is a financial transaction and a type of debtor finance in which a business sells its accounts receivable (i.e., invoices) to a third party (called a factor) at a discount. A business will sometimes factor its receivable assets to meet its present and immediate cash needs. Such arrangements will enhance the liquidity of domestic Mexican automotive suppliers so that they can finance the purchase of the equipment and materials that are needed in order to manufacture product for automotive industry customers.
As regards an automotive forum that is planned to be held in Tlaxcala, Mexico this coming September 2 and 3, Sojo-Quiroz explained that Bancomext officials will discuss the granting of credits to Mexican domestic automotive suppliers not only in the form of factoring, but also for the acquisition of working capital for the purpose of purchasing the fixed assets that are fundamentally important to fueling the growth of a business. Programs to achieve this will be put in place as a result of a collaborative effort between Bancomext and a number of Mexican commercial banks.
In concrete monetary terms Sojo-Quiroz explained that, thus far, this year, Bancomext has injected US $2.2 billion dollars in liquidity into the financial coffers of domestic Mexican automotive suppliers through its factoring program, as well as an additional US $917 million in financial credits. The purpose of this effort is to increase the integration of Mexican-owned automotive suppliers into the companies growing automotive industry supply chain. The automotive industry is one of Mexico’s most dynamic in terms of both expansion and contribution to national GDP.
According to the Bancomext representative, to date, the organization’s support program for domestic Mexican automotive suppliers has directly benefited fifty companies thus far. By the end of 2015, the Bancomext’s goal is to extend the reach of its support program for automotive suppliers to two hundred and fifty of the country’s automotive supplier firms.
Read the primary source for this post in its original Spanish at 20minutos.com.mx