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Help on Sources of Finance

Sources of finance are done due to certain reasons. Let’s take a simple example: New manufactured goods are quite expensive and organization needs capital for that. Therefore, usually when such kind of sourcing will be done it will be financed internally. However; for machinery acquisition, capital will be arranged from external sources. So for the same reason, most of the organizations are in need of short term capital like loan and overdraft.

Following are the sources of Finance:

  1. The Capital Market
  2. Retained Earnings
  3. Bank Borrowings
  4. Venture Capital
  5. Business Expansion Scheme Funds
  6. Franchising
  7. Loans
  8. Government Sources Etc.

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