Financing

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DEFINITION of 'Financing'

The act of providing funds for business activities, making purchases or investing. Financial institutions and banks are in the business of financing as they provide capital to businesses, consumers and investors to help them achieve their goals.

BREAKING DOWN 'Financing'

There is a large variety of financing techniques that businesses and consumers can use to receive financing; these techniques range from IPOs to bank loans. The use of financing is vital in any economic system as it allows consumers to purchase products out of their immediate reach, like houses, and businesses to finance large investment projects.

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