The Cost of Bank Credit Financing
The Cost of Bank Credit Financing

Summary/Abstract: Although the credit is a conventional financing method used by any company, this tool is by far a very significant issue. The range of credits, that a bank provides, and the current policy customize this tool in order to meet the typical financing needs of the enterprises that demands it. Considering the risks, the bank takes the charge of by placing credits, the “eligibility” terms of enterprises that can get such financing being very strict. Restrictions concerning the accepted degree of liability, the accomplished level of performance or available warranties may represent real “barriers” for many companies. Of all “barriers”, the high cost of some financing tools is a good case in point. In order to have a clearer picture of what this financing source is for an enterprise, I have carried out a cost analysis of these financing tools, the medium and long term credit cost and the short term credit cost.

• Details
• Contents