Asset-Conversion Loan

What Does Asset-Conversion Loan Mean?
A short-term loan that is typically repaid by converting an asset, usually inventory or receivables, into cash.

Investopedia explains Asset-Conversion Loan
For example, let's say the TSJ Sports Conglomerate is short on cash and need cash to pay their employees this month. One option they might explore is trying to get an asset-conversion loan to fill that short-term cash void.

Related Terms

Asset
Asset Financing
Cash Conversion Cycle
Corporate Finance
Inventory
Loan
More Related Terms

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