Credit Facility
An arrangement allowing a firm to borrow up to an agreed limit.
Detailed Description
Credit Facility
What is a credit facility?
A credit facility is a financial arrangement between a lender and a borrower that allows the borrower to access funds up to a specified limit.
What are the main types of credit facilities?
The main types include term loans, revolving credit facilities, overdrafts, letters of credit, and trade finance facilities.
What are the advantages of using credit facilities?
Advantages include quick access to capital, flexible usage of funds, and improved cash flow management.
What is the application process for a credit facility?
The application process involves preparing financial documents, submitting an application, undergoing credit assessment, negotiating terms, and signing the agreement.
How do interest rates for credit facilities vary?
Interest rates can vary based on the type of facility, the borrower's creditworthiness, and prevailing market conditions.