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D1: Sources of finance - Coggle Diagram
D1: Sources of finance
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External
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Loans
Allows a company to borrow a set amount of money which is to be repaid in regular instalments, with interest
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Crowdfunding
Attracting investment from a large number of speculative investors, many of whom may invest relatively small amounts
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Mortgages
Long-term loans, normally around 25 years, that are secured against a specific asset e.g. buildings
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Leasing
Paying to use an asset in instalments, however the ownership of the asset remains with the supplier throughout the lease agreement
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Trade credit
A period of time, offered by suppliers, to allow the customer to purchase now and pay later
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Invoice discounting
Reductions offered to customers making a product or service cheaper. Usually applied as a percentage of the total cash flow
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Debentures
A form of bond or long-term loan which is issued by the company. The debenture typically carries a fixed rate of interest over the course of the loan.
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