Money Market Line
A money market is a segment of the financial market in which financial instruments with high liquidity and very short maturities are traded. The money market is used by participants as a means for borrowing and lending in the short term, from several days to just under a year.
Factoring is a flexible cash flow solution specifically tailored for Small and Medium Enterprises, which releases working capital tied up in outstanding invoices. It allows the company to maintain sufficient cash flow to pay for operational expenses, make purchase for raw materials or bid for new projects. Factoring also includes full credit control and account receivables management where the funder will collect invoices payments on the company’s behalf, freeing up the time to focus on growing the business Examples of factoring products are
Machinery & Equipment Purchasing
It is to facilitate the financing of the purchase of machinery and equipment (old or new). This is a financing arrangement for the machinery and equipment purchase whereby the lender will pay the vendor directly. The Lender will acquire and retain the legal ownership of the financed asset, while borrower will become the hirer. The ownership of the financed asset will be transferred to the borrower when the final installment is fully paid. This is unlike a term loan where the borrower holds legal title to the goods from the onset.
Companies can tap on the IP Financing Scheme to access to loan facilities by using their granted patents as collateral.
Secured or Unsecured Working Capital Loan
A loan is secured when a borrower pledged their assets to the lender as security or collateral for the loan. If the value of the collateral falls below a certain proportion of the loan amount, the lender may ask the borrower to top up the collateral (by pledging more assets). If the borrower cannot repay the your loan, the lender can sell off these assets to recover the money owed. If the money from the sale is not enough to recover what the borrower owe, the borrower have to make up the amount (shortfall) still outstanding.
For unsecured loans, the borrower does not provide any assets to the lender as security for the loan. Interest rates for such loans tend to be higher.
Typical secured and unsecured loans are as follows :
Trade is the exchange of capital, goods and services domestically and across borders between a buyer and seller who can be individuals, corporate and governments.
Trade Finance is the act of financing the trade which typically involves intermediaries such as banks and financial institutions to assist the transaction between the buyer and the seller.
Types of trade finance are :