Key terms(2.1.2) Flashcards
Bank loan definition
an external method of finance/money borrowed from a bank paid back with interest (over time)
Business angel definiton
individuals who invest in a business in exchange for a stake in the business (shares)
Crowdfunding definition
an external source of finance where a large number of individuals provide funding for a business or project in return for shares/free products/discounts
External finance definition
money raised from outside the business
Grant definition
a sum of money given by a government or other organisation
does not need to be paid and no interest is charged
Leasing definition
a contract to acquire the use of resources such property or equipment
Loan definition
an external source/method
amount of money borrowed usually repayable after a fixed term of more than 12 months
Overdraft definition
when a business has a negative balance in their bank account because the amount withdrawn is greater than the current balance
Peer to peer funding definition
when a person lends money to other individuals or businesses via online transactions
Share capital definition
the finance raised a business issuing/selling of new shares
Trade credit definition
where a firm receives stock/inventory/raw materials from a supplier which it does not have to pay for until later
Venture capital definition
involves issuing shares to a small number of investor(s) in return for a capital injection into the company
