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What are the main sources of working capital?

幫考網(wǎng)校2020-10-12 17:26:31
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The main sources of working capital are:

1. Trade Credit: This is the credit extended by suppliers to their customers for the purchase of goods and services.

2. Bank Loans: Banks offer short-term loans to businesses to finance their working capital needs.

3. Factoring: This involves selling accounts receivable to a third party at a discount in exchange for immediate cash.

4. Commercial Paper: This is a short-term debt instrument issued by corporations to finance their working capital needs.

5. Inventory Financing: This involves using inventory as collateral to secure a loan.

6. Line of Credit: This is a revolving credit facility that allows businesses to borrow funds up to a pre-approved limit.

7. Asset-Based Lending: This involves using assets such as accounts receivable, inventory, and equipment as collateral to secure a loan.

8. Crowdfunding: This involves raising funds from a large number of individuals through an online platform.

9. Angel Investors: These are wealthy individuals who provide capital to startups in exchange for equity.

10. Venture Capital: This involves raising funds from institutional investors to finance high-growth startups in exchange for equity.
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