Financing: definitions and sources
All companies require financing. Therefore, it is essential for every entrepreneur to know about the different types of financing available, to assess his/her needs and to master accessing the most suitable sources for financing.
What is financing?
Financing means all financial resources, both internal and external, available to a company (corporation, self-employed worker or asbl) giving the latter the means necessary to carry out its activity. In reality, the meaning generally used (bank credit) only covers one source of financing amongst many.
What are the different sources of funding?
The different sources of financing can be broken down into the following main categories:
Each of these categories has its own characteristics:
- legal, fiscal and accounting (compensation, type of commitment, payability, subordination, etc.)
- technical (term, costs, purpose, presence or absence of a financial flow, etc.)
- in terms of risk