The change loan is another term for a discount loan. This refers to a short-term form of financing up to a term of payment. The date of issue and the due date differ. Alternatively, the loan can also be called a trade change if it is used in the business sector. This is the easiest way to finance services and goods.
Basically, the immediate payment is connected with the purchase of a product. However, companies and companies often order extensive services and goods, and obtain greater flexibility in their payments by means of bill of exchange loans. In fact, every entrepreneur and self-employed person who leaves a payment date directly on the bill grants a loan. The discount loan or loan is only one possibility.
How does the loan change?
If a company orders goods from the manufacturer, they do not have to pay for them immediately. The due date of the payment will be set at a later date. Prerequisite for this is the consent to a change. This is the time of payment.
Now it is possible for the supplier to wait for the payment or to deliver it to a bank. The respective sum or credit from the bank is referred to as discount credit. In return, there are equally favorable loans from the Bundesbank at a specific discount rate for the lender.
What are the terms and conditions for a change loan?
The trade change refers to the issued change. In principle, this change can be compared to a check that the borrower submits to the bank in exchange for cash. An interest-bearing loan is subject to specific interest, which can be described as a discount. Often, a change must be triggered and paid after three months. In addition, a successful change to a corresponding creditworthiness and liquidity of the recipient is bound. In conjunction with the obligatory formalities, there is nothing in the way of the swap loan.
What are the advantages of the change loan?
For the most part, companies use short-term loans to avoid endangering their liquidity. So you get from a customer certain sums of money only at a later date. In order not to have to bridge this time, it is possible to plug the gap over the loan to a bank. Only then is it possible for various companies to continue to pursue their current obligations without shifts.
For many freelancers and the self-employed, it is a home-made problem if customers pay too late. This sets a cycle in motion, which leads to own payment delays. The change loan therefore grants a larger margin and makes the customer immediately solvent. The participants themselves are liable here, so that a bank is very sure that the loan will be paid as quickly as possible.
The flexible availability of the corresponding sum of money also has disadvantages. Every change must be requested anew at the bank. In addition, immediate liability occurs if the due date is not available. In this context, very high fees and surcharges may arise. If the agreed amount of money is not available at the balance sheet date, the bank can request it directly from the customer. Each bank has the opportunity to charge fees for submitting the bill of exchange loans. Furthermore, the bill is taxable.