Working capital finance to seasonal industries
This query is : Resolved
Querist : Anonymous
Querist :
Anonymous
(Querist)
21 October 2017
How Bank's assess the Working Capital finance for seasonal industries like rice mill and seed processing? Which method they use?
Second since these business operates mainly for 4-5 months in a year, so how holding periods will be computed by Banks?
Second since these business operates mainly for 4-5 months in a year, so how holding periods will be computed by Banks?
21 October 2017
01. working capital is assessed in the usual and normal manner. There is no any deviation as such.
For seasonal businesses, banks normally ask for WCTL (Working Capital Term Loan) rather than cash credit facility
02.what do you mean by "holding period"?... can you please elaborate?
For seasonal businesses, banks normally ask for WCTL (Working Capital Term Loan) rather than cash credit facility
02.what do you mean by "holding period"?... can you please elaborate?
Querist : Anonymous
Querist :
Anonymous
(Querist)
21 October 2017
Thnx Sir, But WCTL is used for business concerns facing liquidity crunch. I may be wrong.
By holding period i mean Inventory holding period, debtor holding period and creditor holding period.
By holding period i mean Inventory holding period, debtor holding period and creditor holding period.
22 October 2017
01. Crop cycle is taken into account while calculating working capital of seasonal industries.
02. Holding period as you call it is same as for other industries.
02. Holding period as you call it is same as for other industries.
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