Commercial Finance

Commercial Finance can be defined as a composite financial services consisting of personal finance as well as business finance services.

Finance companies are engaged in making loans to individuals or businesses; but unlike a bank, it does not receive deposits but obtains its financing from banks, financial institutions and other money market sources.

Commercial finance can be called a secured business loan or asset-based lending or asset-based finance as the borrower in question can pledge any collateral or asset used in the conduct of the business.

Specifically, commercial finance includes asset-based loans, purchase order financing and credit card receipt advances. Working capital credit lines, import/export financing and inventory loans are also part commercial finance.

Some of the leading commercial finance companies in the world are the GE Commercial Finance Company, GMAC Commercial Finance and the Lloyds TSB Commercial Finance. These commercial finance companies offer financial services for small businesses, medium sized companies to large corporate houses.

Of these, GE Commercial Finance, one of the six operating divisions of General Electric, is probably the largest with branches in over 35 countries across the world and assets worth $ US 232 billion. Formerly, a part of GE Capital, it offers financial services from revolving lines of credit to floor plan finance to equipment leasing of various forms, real estate services and car fleet management.