ASHGABAT, Turkmenistan, July 7. Factoring volume could reach about $1.9 billion within a 3- to 5-year medium-term potential in Turkmenistan, Trend reports.
According to the Asian Development Bank (ADB), the basis of this forecast is the GDP indicator of Turkmenistan where its GDP in 2022 GDP was $78 billion.
"Despite factoring being recognized in the legal framework, there is limited development of factoring operations in Turkmenistan. Moreover, non-bank financial institutions are not regulated; therefore, any activities carried out by them would fall under the supervision of the Ministry of Finance, and they would not be recognized as factoring defined under the legal framework for banks," the ADB said.
ADB also noted that the limited introduction and use of factoring by banks and non-bank financial institutions highlights the need for increased awareness and training of supply chain finance products.
"It is also important that non-bank financial institutions are offered the same legal recognition of factoring as banks," the bank said.