Investments glossary

Vendor Financing

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Quotes of the day:

a good tooth, gets no gold

— Severin Meiland

Vendor financing is a financial term that describes the lending of money by a vendor to a customer who uses that capital to purchase that specific vendor’s product or service offerings. Sometimes called trade credit, vendor financing usually takes the form of deferred loans from the vendor. It may also include a transfer of stock shares from the borrowing company to the vendor. Such loans typically carry higher interest rates than those associated with traditional bank loans.

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