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FACTORING VERSUS BANK LOANS AND THEIR IMPACT ON FOREIGN TRADE OPERATIONS
Abstract
Establishing and developing a business requires the existence of financial resources. Therefore, in the case of foreign trade business is primarily puts it the problem of the financing of foreign trade activities. Moreover, in international economic relations system, financial and banking techniques to promote economic exchanges with foreign occupies a special place. As a general term, financing involves, regardless of its shape, attracting the funds needed for the business, funds that could be made from its own resources (equity) or external sources (borrowed capital). In the latter case funding will be strengthened on a lending relationship. Funding from external sources, in international trade is carried out both by classical techniques of credit (credit the buyer and supplier credit), as well as through special financing techniques (leasing, factoring, standard). But all of them should be adapted to the requirements of foreign trade, and the funding sources can be both from the banking market and the capital market, local or international. Development of contemporary trade is due, in particular, the unprecedented growth of the role of international credit, but also the permanent diversification of financial and banking techniques intended to ensure the most flexible use of financial resources, according to the new requirements of international trade. Based on these assumptions we made in the research on the subject, a comparative analysis of the financing techniques used in foreign trade activities in order to obtain reliable conclusions to support the development of foreign trade activities. In order to achieve the research we use materials from theoretical literature to support the practical study developed to obtain the most advantageous form of financing abel to support growth of foreign trade activities.
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