Asset finance indicates the use of a company’s balance sheet assets, inventories, short- term investments, etc. to get a loan or borrow money. The company borrowing these funds must provide the lender with a security interest in the assets. Asset finance gives a business to purchase equipment such as machinery, vehicles, or almost anything that helps in the enhancement of the business. This also helps to release cash from the value of the assets that the business already owns. Asset finance in Dubai is a form of financing that is applied to the purchase of tangible and intangible assets.
An Asset is a resource owned or controlled by an individual, or a firm or by the government with the prospect that it will generate potential cash flow. Assets are economic resources. The initial priority while setting up any business is the cataloging of all the assets that are possessed by the company/firm. Accurately identifying and classifying the types of assets a firm possesses is very crucial to the survival of any firm/ corporation, specifically its solvency and associated risks.
In simple words, Assets symbolizes the value of ownership that can be converted into cash. Assets can be classified in three ways: –
1. Convertibility: This classification is based on how easy it is to convert them into cash.
2. Physical Existence: This is based on their physical existence (or tangible vs. movable assets).
3. Usage: Classifying assets based on their trade operation usage.
CREDIT & COMMERCE assists business to get asset finance by understanding the value of the company’s assets and arranging the most suitable financial lenders that would give the most value for the assets that are used as a security deposit to get quick cash inflow for their business.
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