Sources of finance

Sources of finance

1. Owners Savings

   • Owners own money

2. Retained Profits

   • Profits kept back from previous years

3. Bank Loans

   • A specific amount of money that must be paid back in instalments with added interest

4. Bank Overdraft

   • The business can use more money than it actually has in its bank account but will have to be paid back with interest

5. Government Grants

   • Finance from the government, the EU or an enterprise company that does not have to be paid back

6. Trade Credit

   • The business buys goods from the suppliers but does not pay for them immediately

7. Debt Factoring

   • Selling the businesses debt to another business for less than they are worth

8. Selling Shares

   • Investors pay to become a part-owner of the company. They receive a divide each year.

9. Issuing Debentures

   • A group of loans from individuals or other companies. They lend the money and receive back a faxed amount of interest as well as the whole amount of the loan

10. Donations from public

    • The general public give money to the business

11. Lottery Grants

    • Finance from the lottery fund that does not have to be paid back

12. Taxation

    • Money paid by people who work, the amount paid depends on how much they earn