The size of the financial guarantees market in Canada is expected to reach
The COVID-19 pandemic has affected the country’s economy and commerce. In addition, enormous costs were incurred by exporters and exporters in doing business, which therefore severely affected the Canadian financial collateral market.
The Canadian financial guarantees market was valued at $ 1.32 billion in 2020 and is expected to reach $ 2.19 billion by 2028, growing at a CAGR of 7.3% from 2021 to 2028.
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Banks are mainly engaged in providing financial guarantees to traders in the event of large international transactions. As the seller does not know the buyer, the need for financial guarantors continues to increase among sellers. In addition, banks provide a performance bond or guarantee, which essentially guarantees that the goods supplied to a buyer are as promised and delivered as contractually agreed with the seller.
Factors such as technological advancements in the field of financing and reduction of financial risks are propelling the market growth. In addition, increased government financial guarantee support and initiatives and increased import and export activity should provide lucrative opportunities for financial guarantee providers in Canada.
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On an end-user basis, the importer segment dominated the Canadian financial collateral market in 2020 and is expected to maintain its dominance during the forecast period. This is attributed to the fact that importers increasingly engage in massive trade by importing bulk goods from different countries, which involves complex transactions. As a result, the demand for financial bank guarantees among importers continues to increase and becomes a major trend in the Canadian financial guarantees market.
According to Pramod Borasi, Senior Research Analyst, BFSI at Allied Market Research, âThe COVID-19 pandemic has affected the country’s economy and commerce. In addition, enormous costs were incurred by exporters and exporters in doing business, which therefore severely affected the Canadian financial collateral market. “
The Canadian financial guarantees industry has been severely affected by the sudden shutdown of businesses. In addition, traders have shifted their preferences for financial guarantee products, especially for metals such as aluminum and nickel, due to the impact on industries such as automotive and aviation, respectively. Additionally, the resulting lockdown disrupted supply chains, which in turn resulted in a situation where buyers did not pay dues to manufacturers. As a result, these major factors affected the growth of the Canadian financial collateral market during the pandemic situation.
Main conclusions of the study
By product type, the documentary letters of credit segment dominated the Canadian financial guarantees industry in terms of revenue in 2020.
By business size, the large business segment had the highest Canadian financial collateral market share in 2020.
On an end-user basis, the importer segment achieved the highest turnover in 2020.
The main players presented in the analysis of the Canadian financial guarantees market are Scotiabank, Toronto Dominion, National Bank of Canada (National Bank of Canada), Bank of Montreal (Bank of Montreal), BNP Paribas, HSBC, Citigroup , Inc., CIBC, Royal Bank of Canada and Export Development Canada. These players have adopted various strategies to increase their market penetration and strengthen their position in the industry.
Trade finance market: https://reports.valuates.com/market-reports/QYRE-Auto-6X849/global-trade-finance
Non-bank trade finance market: https://reports.valuates.com/market-reports/QYRE-Othe-3A258/non-bank-trade-finance
Letter of Credit Confirmation Market: https://reports.valuates.com/market-reports/ALLI-Manu-1V31/letter-of-credit-confirmation
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This version was posted on openPR.