Wholesale Money

AAA

DEFINITION of 'Wholesale Money'

Funds borrowed by corporations, in high amounts, through financial institutions. Wholesale money is a way for large institutions to obtain capital without having to issue shares or bonds. These loans will usually be issued by large financial institutions and banks to long-standing, financially secure companies and have a lower-than-average interest rate.

INVESTOPEDIA EXPLAINS 'Wholesale Money'

The advantages of this type of loan are the quick availability and immediate use of the funds. For example, these funds may be used by a company to quickly act on an opportunity which might otherwise be missed.

Wholesale money is obtained as a loan and therefore requires periodic payments, much like a bond, but requires less time and effort than a bond or new-stock issue.

RELATED TERMS
  1. Financial System

    A financial system can be defined at the global, regional or ...
  2. Financial Institution - FI

    An establishment that focuses on dealing with financial transactions, ...
  3. Loan

    The act of giving money, property or other material goods to ...
  4. Bank Rate

    The interest rate at which a nation's central bank lends money ...
  5. Bank

    A financial institution licensed as a receiver of deposits. There ...
  6. Offering

    The issue or sale of a security by a company. It is often used ...
RELATED FAQS
  1. What are the sources of funding available for companies?

    Despite all the differences among companies, there are only a few sources of funds available to all firms. 1. They make profit ...
  2. Why do companies issue debt and bonds? Can't they just borrow from the bank?

    Companies issue bonds to finance operations. Most companies can borrow from banks, but view direct borrowing from a bank ...
Related Articles
  1. Investing Basics

    Will Corporate Debt Drag Your Stock Down?

    Borrowed funds can mean a leg up for companies or the boot for investors. Find out how to tell the difference.
  2. Investing Basics

    Reading The Balance Sheet

    Learn about the components of the statement of financial position and how they relate to each other.
  3. Entrepreneurship

    Mezzanine Financing

    Learn about this alternative method of financing companies use to finance expansion.
  4. Personal Finance

    Promissory Notes: Not Your Average IOU

    These may be a handy way to borrow money, but this convenience does not come without risk.

You May Also Like

Hot Definitions
  1. Prepaid Expense

    A type of asset that arises on a balance sheet as a result of business making payments for goods and services to be received ...
  2. Gordon Growth Model

    A model for determining the intrinsic value of a stock, based on a future series of dividends that grow at a constant rate. ...
  3. Cost Accounting

    A type of accounting process that aims to capture a company's costs of production by assessing the input costs of each step ...
  4. Law Of Supply

    A microeconomic law stating that, all other factors being equal, as the price of a good or service increases, the quantity ...
  5. Investment Grade

    A rating that indicates that a municipal or corporate bond has a relatively low risk of default. Bond rating firms, such ...
  6. Fringe Benefits

    A collection of various benefits provided by an employer, which are exempt from taxation as long as certain conditions are ...
Trading Center