FinShare's Asset Based Lending (ABL)
Asset Based Lending (ABL) is one method banks use to create credit facilities for many of their business customers.
In ABL, a company's assets are used as collateral to generate a facility which can be drawn against for working capital.
Almost any asset a customer has can be utilized as collateral for lending purposes.
For example: accounts receivable, inventory, fixed assets, real estate, cash or cash equivalents, etc can be tracked and monitored by our application.
The two primary assets used are Receivables and Inventory.
Credit committees within banks usually create maximum borrowing limits that cannot be exceeded, regardless of asset valuations or borrowing base.
This is monitored by FinShare's Risk Management engine and may be synchronized with the bank’s other limit tracking systems.
Assets tracked, and monitored as part of the collateral valuation process are:
- Streamlined or formula based accounts receivable financing
- Inventory financing with sub categories (i.e.: raw materials, work in process, finished goods, as well as
- Fixed assets with sub categories such as plant and fixtures, equipment, real estate, etc
- Cash or cash equivalents including sub categories (i.e.: cash, securities, time deposits, Bonds, etc)