Self liquidating loan example
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is a term that is used to describe any investment in which the acquired stock, bond, property, or other holding has the inherent capability to offset the expense that was incurred in order to acquire the asset.
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One example of a self-liquidating asset would be the construction of a building or toll bridge for use in a city or town.
From that point forward, both projects would be able to remain self-sustaining and even earn additional profits that could be used to fund other municipal projects.In such scenarios, the facility of export packing credit supports the exporter’s supply chain and provides them funds to bridge the gap till the final payment.The bank issuing the packing credit will usually advance the partial or full proportion of the invoice, depending on the assumed risk.Packing credit is the most commonly used trade finance tool by an exporter.Packing credit or pre-shipment finance is very important to small and medium enterprises for their financing needs.