Asset Based Lending
Our simple process gives you the business capital to grow your buisness correctly.
Asset Based Lending (ABL)
Asset-based lending (ABL) is a financing solution where businesses secure loans or lines of credit based on the value of their assets. These assets typically include inventory, accounts receivable, equipment, or real estate. ABL is commonly used by companies to obtain working capital or fund growth without taking on traditional unsecured debt. Here are some key examples of asset-based lending:
1. Accounts Receivable Financing: A business uses outstanding invoices as collateral to secure a loan or line of credit. This allows companies to access immediate cash based on the value of unpaid invoices, bridging cash flow gaps while waiting for customer payments.
2. Inventory Financing: Businesses use their inventory as collateral to secure funding. Retailers and manufacturers often leverage inventory financing to purchase new stock or manage cash flow during peak seasons.
3. Equipment Financing: Companies can use machinery or equipment as collateral to secure loans. This is especially useful in industries like construction and manufacturing, where expensive machinery is crucial to operations.
4. Real Estate-Based Lending: Businesses that own real estate can use their property to secure loans. This financing is ideal for large investments such as expansion projects or real estate developments.
5. Purchase Order Financing: Companies use confirmed customer orders as collateral to secure funds. This financing helps businesses fulfill large orders without straining working capital, with repayment occurring once the order is completed and the customer pays.
Asset-based lending offers businesses flexible solutions by leveraging assets like receivables, inventory, equipment, or real estate to improve cash flow, fund growth, and seize new opportunities.
