Key Points
- Longer term funding is supplied by bonds and equity.
- Convenience is main benefit of a credit card to a business or entrepreneur.
- Venture capitalists use bridge loans to “bridge” cash flow gaps between successive major private equity financing terms.
Key Terms
- venture capital: money invested in an innovative enterprise in which both the potential for profit and the risk of loss are considerable.
- benchmark: A standard by which something is evaluated or measured.
- collateral: A security or guarantee (usually an asset) pledged consumer installment loans Alabama for the repayment of a loan if one cannot procure enough funds to repay. (Originally supplied as “accompanying” security. )
- London Interbank Offered Rate: the average interest rate estimated by leading financial instiutions in London that they would be charged if borrowing from others
Short Term Loans
The borrower receives cash from the lender more quickly than with medium- and long-term loans, and must repay it in a shorter time frame.
Overdraft
Overdraft protection is a financial service offered by banking institutions in the United States. An overdraft occurs when money is withdrawn from a bank account and the available balance goes below zero. In this situation, the account is said to be “overdrawn. ” If there is a prior agreement with the account provider for an overdraft, and the amount overdrawn is within the authorized overdraft limit, then interest is normally charged at the agreed rate.
Credit Card
A credit card is a payment card issued to users as a method of payment. It allows the cardholder to pay for goods and services based on the holder’s promise to pay for them. Continue reading Short term loans are borrowed funds used to meet obligations within a few days up to a year