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Vendor Financing |
Also found in: Acronyms | 0.06 sec. |
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Vendor Financing The act or practice of a company lending money to a customer so the customer can buy the company's products. Vendor financing allows the company to increase its sales because the customer likely would not have bought from the company otherwise. However, it carries a great deal of credit risk, especially since the customer may or may not have a good credit history and may not pay back the debt. In a situation in which the company is not repaid, it essentially has bought its own products and given them to the customer. In such cases, it writes off the loss as bad debt. See also: Credit sale. How to thank TFD for its existence? Tell a friend about us, add a link to this page, add the site to iGoogle, or visit webmaster's page for free fun content. |
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