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Organisations and the financial system
Organisations and the financial system

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1.2 Internal sources of finance

Table 2 (a) summarises the sources of finance that you will cover in this course. You will start by looking at examples of internal sources of finance (emboldened in the tale), beginning with short-term examples and concluding with the most common source of long-term internal financing.

Table 2 (a)  Sources of finance
Internal External
Debt Equity
Short-term
  • Debt factoring
  • Invoice discounting
  • Working capital management
  • Bank overdrafts
  • Bank loans
  • Crowdfunding
  • Peer-to-peer lending
  • Crowdfunding
Long-term
  • Retained earnings
  • Bank loans
  • Financial lease
  • Hire purchase agreements
  • Bond issuance
  • Business angels and venture capital
  • Stock issuance