Lender of Last Resort
Banks are financial institutions that have been lending funds to individuals and corporate bodies down the years. On occasions when an individual needs funds/face a liquidity crunch, he may …
Sources of Finance
Syndicated Loan
Syndicated Loan – Meaning A syndicated loan is an essential source of debt financing for corporate. It is availed from a group of lenders. Lenders include commercial banks, Government …
Senior Debt – Features, Importance, Advantages And More
Senior debt is a loan that a company must repay first if it gets into some financial trouble. It is the most common form of lending and carries a …
Intercreditor Agreement – Importance, Provisions And Issues
An Intercreditor Agreement (or inter-creditor deed) is a contract between two more creditors. Such an agreement comes into effect when the borrower has two (or more) lenders. The lenders …
Flotation Cost
What is Flotation Cost in Finance? Flotation cost is the fee charged by investment banker for its assistance in raising new capital. This flotation cost includes legal fees, underwriting …
Peer-to-peer Lending – An Alternative Source Of Finance
What is Peer-to-peer lending? Peer-to-peer lending (P2P) is a relatively new form of debt financing. It is a type of crowd-funding that addresses the needs of both – people who …
Letter of Credit Finance
What is a Letter of Credit Financing? It is common knowledge that a letter of credit is a payment instrument for international trade, but not many people know that …
Temporary Overdraft
Temporary Overdraft – Meaning An overdraft facility is a credit facility where the borrower can withdraw more money from its bank account than the available balance. The banks extend …
Revocable Letter of Credit
Revocable Letter of Credit – Meaning A revocable letter of credit is a type of letter of credit in which the issuing bank can amend the terms of the …
Difference Between Lease and Finance
Both lease and financing are fundamental means to fund the purchase of an asset or investment. The end goal is the same; to give the borrower/hirer possession and right …
