What is pre-financing?


What is pre-financing?

An example of pre-financing is keeping products in stock so that you can deliver them quickly. This means that before you receive money from your customers, you need to have your own funds available to pay for or finance this inventory.

Additionally, the payment terms you offer to your customers (debtors) represent another form of pre-financing. Thanks to the policies of your organization, your customers can have access to the money they owe your organization for a shorter or longer period. The opposite applies to suppliers (creditors).

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