Implementation of the Database of MSME Electronic Credit Invoices Not Paid Upon Maturity

As from November 1, unpaid electronic credit invoices issued by micro-, small-, and medium-sized enterprises (facturas de crédito electrónicas MiPyMEs, FCEMs) will be recorded in the BCRA's Database of MSME Electronic Credit Invoices Not Paid Upon Maturity (Central de Facturas Electrónicas MiPyME Impagas al Vencimiento, CENFIV). The implementation of this database is a key step towards the consolidation of FCEMs as a financing instrument for MSMEs. The new database will promote transparency thanks to the information provided and will create a credit record to improve the traceability of FCEMs.

The CENFIV will display the payment behavior of large companies through several indexes, providing greater certainty about the payment of FCEMs issued by MSMEs.

The implementation of the CENFIV is another measure adopted by the BCRA to expand the financing alternatives for MSMEs. Also, this means streamlining the use of FCEMs through a straightforward operation that accommodates MSMEs´ daily management.

Last year, the BCRA implemented the regulation of the system for the open transfer (sistema de circulación abierta, SCA) of FCEMs through banks. Through this system, MSMEs may quickly and easily transfer or discount FCEMs from their bank accounts. MSMEs may carry out any of these actions through online banking. Transfers of FCEMs are free of charge; hence, financial institutions may not charge any fees.

The SCA will allow MSMEs supplying large companies to draw on a larger number of financing sources in advance. This system will also enable other transactions, such as: transfer of FCEMs outside exchanges, trade of FCEMs in the secondary market, payment of FCEMs through interbank clearing, and record of FCEMs entered in the SCA which are paid after acceptance (implied or express) and prior to maturity.

The use of FCEMs by MSMEs exhibits an upward trend. In the past year, the number of electronic credit invoices used by MSMEs as a financing tool grew 34% (monthly average), from 410 invoices (monthly average) in 2021 to 550 invoices (monthly average) in 2022 (until August 2022). The amount of electronic credit invoices traded increased 137% (ARS3,400 million - monthly average), reaching ARS27,200 million up to August 2022.

Since its implementation—April 2021 through June 2022—around 1,300,000 FCEMs entered the SCA. This means that 62% of accepted FCEMs were made available to MSMEs through online banking for management and collection through interbank clearing.

The promotion of FCEMs is the result of the joint work of the Federal Administration of Public Revenue (Administración Federal de Ingresos Públicos, AFIP), the BCRA, and the Secretariat of MSMEs and Entrepreneurs from the Ministry of Productive Development.

Benefits for MSMEs and Large Companies

The use of FCEMs as a financing instrument entails several advantages, both for MSMEs and large companies. As for MSMEs, the FCEM has lower financing costs since a large company is the debtor; it also implies lower risks for MSMEs (as they are not liable for payment and thus are not subject to legal proceedings in the event of default); it does not count towards MSMEs’ credit quota (since it is not considered debt for the issuer, it does not reduce the credit quota available to be received as a loan); and it does not have to be guaranteed to be traded.

Large companies can also benefit from FCEMs by deferring the payment of tax withholdings, depending on the policy adopted for their suppliers. If a large company accepts an invoice, withholdings must be paid after the due date, generating substantial financial savings.

November 1, 2022

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