Asset Based Lending FAQ

Below you will find the answers to some of the most commonly asked asset based lending questions.

What is asset based lending?

Asset based lending describes a type of business loan that uses business assets as collateral. Through this method of business funding, a business can facilitate its cash flow by using the value of its assets to secure financing.

How asset based lending works?

Asset based lending is usually structured as a revolving line of credit where a business can borrow against its assets (collateral) to cover its cash flow needs. Acceptable collateral can include: accounts receivable, inventory, machinery, equipment, trademarks, customer lists.

Who uses asset based lending?

Businesses that urgently need cash flow to meet financial requirements or growth goals, can achieve these benefits via asset based lending:

  • Working Capital
  • Growth & Acquisition
  • Refinancing & Restructuring
  • Capital Expenditures

 What does ABL stand for in finance?

ABL stands for an Asset Based Loan or Asset Based Lending.

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