Director paying companies creditors.

Mohan Kale (358 Points)

11 July 2020  
If a director of private limited company pays off companies creditors out of his borrowed funds would that amount to loan to the company by director from his borrowed funds? A company is undergoing financial crunch so is director. Company is not in a position to borrow from outsiders/banks hence director want to borrow fund from a bank and pay off the creditors. Please advise.

Thanks in advance.