Read more
INTER-COMPANY CREDIT ? The main function of finance is to find the most advantageous resources to obtain the industrial and commercial means necessary for the operation of the company (Hervé Hutin, toute la finance quatrième édition). Financing constraints are a headache for all companies. The relationships linked to the external financing of the company's activity highlight a mode of financing that is widely used and yet little studied. The combination of payment terms and down payments places the company either in the position of a lender or a borrower of inter-company credit. The payment periods granted between firms reveal a very important redistribution of funds between them. Combined with down payments and advances, they place firms either in the position of borrower or in the position of inter-firm credit borrower. In the first case, these situations give rise to credits received from firms that replace bank credit and, in the second case, to additional assets to be financed.
About the author
Elimane MBENGUE is a trained financier with a Master of Science in Management, specializing in corporate finance. With professional experience in the banking, oil and SME sectors, he has conducted several studies on financial relations between companies.
