What are Corporate Credit Cards? – Different Types of Cards
February 12, 2025
When a company files for bankruptcy, the interests of many different parties are impacted. This is the reason that bankruptcy cases can be very difficult to conclude. There are a lot of stakeholders involved, and each wants to pursue their own interest at the expense of everyone else. The result is that a tug of […]
Sporting franchises are often said to be confused about what their objectives should be. One chain of thought believes that since they are businesses, their objectives should also be financial in nature. This means that their objectives should also be about profit maximization or wealth maximization. On the other hand, there is a different chain […]
There is more than one entry route if one wants to gain an exposure in the commodities market. Positions can be built via many alternate routes. In this article we will look at some of these routes as well as their pros and cons. Physical Purchase Physically purchasing the commodities is the most direct and […]
What is Blockchain and what is a Distributed Ledger? Not a day goes by without a media report on how a particular firm or entity as well as an upcoming governmental initiatives is thinking of using Blockchain technology for security, integrity, and consistency of data. Further, anyone who has heard of Bitcoin would have definitely […]
Debt securities are widely issued and traded in the secondary market. Debt securities could have a fixed interest rate or a floating interest rate. When debt is taken for the short term, fixed interest rates are preferred. However, in the medium to long run, the interest rates cannot be directly fixed. This is because, as […]
In the previous articles, we have seen the various non-lending-related commercial banking products which are offered by banks. However, at the end of the day, a commercial bank is a bank. This means that its main business is still to lend money. When it comes to commercial banking, the loan products are quite different from the ones used in retail banking.
In this article, we will have a closer look at the concept of Swingline loans. We will also understand how these loans are different from other loan products offered by commercial banks.
For instance, when a company takes an overdraft from a commercial bank, they can utilize the cash as per their requirements. They can buy new assets with it if they want. They could even host a marketing event with the money if that is what the company wanted!
However, when it comes to Swingline loans, they are given to the borrower on the clear understanding that this money will only be used to repay old debt. In many cases, banks do not even disburse the loan to the borrowing corporation. Instead, they directly pay off their creditors. Hence, it can be said that the terms and conditions of a Swingline loan are more restrictive as compared to other loans provided by commercial banks.
Swingline loans are widely used by businesses that are facing a cash crunch. However, they are not the only option that is available to a business. Swingline loans are inherently competing with several other banking products provided by the commercial bank itself. Some of them have been listed below:
The bottom line is that Swingline loans form an important part of the overall commercial banking portfolio. There are several pros and cons of a Swingline loan which will be discussed in a later article.
Your email address will not be published. Required fields are marked *