At the end of 2020 we witnessed another milestone in the fast-evolving history of the Italian Securitisation Law, an innovation which is likely to have a long-lasting impact on how Italian securitisations will be structured from now on, and to improve their ability to better adapt to the ever-changing needs of the market.

The 2021 Budget Law has introduced an alternative funding tool for Italian securitisation vehicles (or SPVs) alongside the traditional asset-backed notes. SPVs may now fund their securitisation transactions also through the proceeds of ad hoc financing advanced by entities who are licensed to grant loans in Italy. This Square The Circle is intended to collate our thoughts on this new tool and to explore its likely uses.