Types of financing

It is called an act of financing when one of the parties involved in the operation is assigned a certain amount of money by another person, company or financial or banking institution. The purpose of this financing is to have the opportunity to meet certain debt obligations or to pay for certain assets or services .

This type of credit mode operation is carried out through a form of contracting by both parties in the same country and even outside of these. One of the parties may be in one place and the other in a different place. Financing operations are given in the form of loans, forms of credit or through the issuance of credit titles.

Types of financing

Short-term financing

It is a financing model in which the obligations or debt that are the responsibility of the debtor must be settled in a short period of time that generally does not exceed one year or fiscal year. Therefore, when this type of financing is requested, an adequate projection of the payment capacity must be made to see if it will be possible to meet that debt commitment.

Types of short-term financing

Line of Credit Financing

It is related to the amount of cash that the person can withdraw according to the provision negotiated in a bank, the same benefit that can be enjoyed during the time that has been agreed in the financing negotiation.


I will pay

It is a type of debt that is acquired through an agreement in written form in which the obligation of the contracting party of the debt is stipulated to settle said debt within a certain period of prior agreement, said document is already previously prepared, it is only enough to fill in some fields and the corresponding signatures.

Blank check

Commercial credit

In the financing process, the value that a certain company has in an account comes into play, which is put as collateral and thus the loan process can be accelerated. This is done in order to inject capital into the company to reorganize the operations of the same company and obtain better profits.

Credit cards in pocket

Bank credit

As its name indicates, it is a type of financing based on a specific credit that is obtained through negotiation and tacit agreement with banks. The banking institution offers the client a series of packages, from which the one that fits the needs and payment possibilities is selected. You must be very careful with the debt interest rates that are offered.

House figure made of coins and banknote

long-term financing

Financing is established in which the debt can be settled in a period greater than one year or fiscal year. Most financing of this type is established as a settlement term of five years. As with short-term loans, it is important that the financing party analyze the best package that suits their needs and payment possibilities.

Contract signature with black pen

Types of long-term financing


In this case, the debtor acquires a type of certificate that commits him to the total settlement of the debt in a previously agreed time in which it is clear both the capital and the interest that will be generated, the sum of both being the final debt to be settled.

voucher printing


In this case we have a financing that is acquired through the participation of capital within a company and at the end of the fiscal year the profits that were achieved are distributed or, where appropriate, to comply proportionally to the value of the shares, with the losses. of the company. These types of people are called shareholders of the company and depending on the purchase of shares, they will have voice and vote or only vote.

sphere with banknotes

Medium-term financing

It is a type of financing obtained by a contracting party in which he agrees to settle the respective debt in a period of time that includes more than one year without exceeding five. They are generally used when a company requires the continuity of the operation and efficiency of its working capital or to inject more liquidity into the company’s assets.

Red car

External financing

This is a financing case that is used when the applicant cannot work with his or her business activities in a normal way with his or her own resources. Therefore, it seeks financing through third parties in order to continue operating efficiently.

Handshake with bills

Internal financing

It is done by reallocating the company’s own resources through the creation and operational implementation of capital reserves.

Person stepping on money and raising his hand

Free financing

It is a financing that unlike the other forms, when contracted, no type of cost is acquired. This means that only the capital debt is acquired and no type of interest or commission will be generated for the operation carried out.

zero percent color

Onerous financing

Contrary to the previous case, in this type of financing if costs to be covered are acquired in addition to the debt. These costs come from commissions for operations, interest on arrears or guarantees.

Delivery of merchandise for money

Financing from friends and relatives

This type of financing generates a type of trust for the contracting party, since in order to obtain the money he requires, he does so through his family or friends, who normally request a very low interest payment or even without including them in the total debt.

people talking

Financing for personal savings

It is a form of self-financing that is granted by the person who needs money, since it is assigned through a savings account that they have. That is, you have her savings to lend to yourself in a bank account.

Piggy bank with a coin

Bank or credit union financing

It is a financing granted by a bank to the contracting party, although for this it is necessary that the person requesting it justify the amount and give reasons for what that amount will be used for if it is provided. In the end, the debt of the borrowed capital must be settled with its generated interest.

People coming to a mutual agreement

Private equity firms

It is a type of financing that is granted to some companies that are in a stage of expansion or operational growth or of branches. For this purpose, companies need more capital to meet these objectives and therefore resort to this type of financing.

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