Financial support system

I am student of MBA final year and i want to share my knowledge with others

1. Topic – financial support system submitted by sakshi garg submitted to Dr Nidhi singhal mam class – M.B.A 3 rd sem

2. FINANCIAL SUPPORT SYSTEM

3. FINANCIAL SUPPORT SYSTEM A financial system: is a system that allows the exchange of funds between lenders, investors and borrower. Financial systems operate at national, global and firm-specific levels. They consist of complex , closely related services, markets, and institutions intended to provide an efficent and regular linkage between investors and depositors.

4. In Entrepreneurship Basic need to become a entrepreneur is fund without found a entrepreneur can not established his idea. So financial support system is that which provide the guideline to arrange the fund for the enterprise. As sources of fund where can it obtained and in which form.

5. Forms of financial support

6. According to the application Fixed capital It refers to funds used for purchase of fixed assets like land , building, plant and machinery and other expenses. Working capital It refers to funds used for raw material purchase, payment of salaries / wages , rent , fuel , electricity ,etc. it is also known as Revolving capital since it is continuously invested incurrent assets and recovered through sale of products.

7. According to its Requirement LONG TERM CAPITAL It is usually for five years or more. MEDIUM- TERM CAPITAL Normally implying requirment of 2 to 5 years SHORT – TERM CAPITAL It is for a period less than 1 year.

8. According to its Nature EQUITY OR OWNERSHIP CAPITAL : The investment is a permanent part of the firm’s capital structure and raising equity is possible by selling additional shares or by investing profits back into bussiness . DEBT CAPITAL : It is a lower risk proposition , since it needs to be repaid according to agreed schedule . Debt capital can be firther sub- divided into short-term – generally upto one year, and mediu , term – one year to ten year.

9. SHORT TERM FINANCIAL SUPPORT

10. LONG TERM FIANCIAL SUPPORT

11. SOURCES OF FINANCIAL SYSTEM

12. Internal financial support

13. EXTERNAL FINANCIAL SUPPORT TYPE OF FINANCE PERIOD OF REQUIRMENT PURPOSE Short term Medium – term Long - term Less than 1 year 1 to 5 year more than 5 year Purchase of raw materials Payment of wages, rent, etc , expenditure of advertisment Purchase of land and building plant and amchinery

14. THANK YOU