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Current State Of Entrepreneurship Financing Mechanisms

Table 2:

Name of procedure Brief description Benefits Disadvantages
1 2 3 4
Leasing A kind of long-term loan in kind and repayable in installments. 1) The ability to minimize property tax;2) the transaction is secured by acquired equipment;3) a leasing agreement is more flexible than a loan;4) the risk of obsolescence of the equipment lies entirely with the lessor. 1) The lessee does not win by increasing the residual value of the equipment;2) the complexity of the organization of the transaction;3) the inability to redeem property ahead of schedule.
Overdraft Bank lending to a client’s current account for payment of settlement documents in case of insufficient or absent funds in the client’s current account. 1) Provides continuity and acceleration of the circuit of working capital;2) a flexible form of lending, providing borrowed funds to the extent of the emerging need;3) ease of design. 1) The loan is repaid at the request of the bank – the borrower may lose the source of payment in a critical period;2) only a short-term source;3) high cost;4) overdraft size is limited.
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