business finance

This refers to the value of the assets that the customer has and plans to use to secure the credit.

• collateral

• dividend

• shares

what is the disadvantages of trade creditors?

• loosing trust from the supplier (ethical)

• interest required for repayment

• take long time to approved

• high risk of diluting control

what is bank overdraft?

• bank allow business to owed, underpay for several months

• renting the assets to have cash flow

• the bank balance is under 0

• owe the bank by selling the shares

is bank overdraft an useful finance tool for seasonal fluctuation?

• yes

• no

list the advantages of bank overdraft

• support cash flow

• flexible, quick, don't need to go to the bank an apply

• collateral is not necessary

• no interest rate for repayment

what are the cons of bank overdraft?

• It affects your credit score

• has very high interest rate (interest calculated per day)

• expected to pay within next month

• need to persuade the bank to owe

what is dividend

• reward, cash or otherwise, that a company gives to its shareholders

• can be used as shares, payment

what are bridge loan features?

• using current assets to borrow short term loan

• able to loan by meeting short term liquidity

• about 2 -3 weeks

• support cash flow

what are disadvantages of bridge loan

• has interest

• can not repeated use this financial tool

• not flexible - take long time to process and money

name the benefits of factoring

• focus on profits than collect debt

• transfer stress to factoring company

• immediate cash

• earn profit from selling assets