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Manage Finance

UNDERSTANDING FINANCIAL INSTITUTIONS

The Company is a combination and variety of natural resources such as economic, labor, capital, and management (managerial skills) in producing goods and services in order to achieve certain goals. Various corporate objectives include: to get maximum benefit, ensuring the survival of the company, meeting the needs of the community, creating employment opportunities, and some financial management experts argued the company’s goal is to maximize corporate value or shareholder wealth maximization.

In general, companies can be divided into two, namely:
· The company’s first financial and
· The second, non-financial companies. Non-financial company is a manufacturing company that produces products in the form of goods such as: cars, steel. computer and or companies that provide non-financial services such as: transportation and computer programming. While financial companies, generally known as a financial institution, the company that provides services related to finance

1) Transformation or transfer of financial assets through the market.
Namely the transfer of funds and that have excess funds (surplus) to the party underfunded (deficit). This is a function undertaken by financial intermediaries (financial intermediaries), which is an important role and financial institutions. Services performed by banks, insurance companies, pension funds and finance companies.

2) Trading financial assets on behalf of customers.
Services performed by the broker (hi-ocher) to buy or sell securities on the orders of customers.

3) Trading financial assets for the benefit of its own
Services performed by the company’s securities (dealer) to buy and sell securities for their own corporate interests.

4) assist in the creation of financial assets to customers, and sell financial assets to other market participants. Services performed by the company’s underwriters in the issuance of shares.

5) Provide investment consulting to other market participants.

6) Manage the portfolio of other market participants (Fabozzi, 1994: 19).
Financial institutions can be defined as an entity whose assets primarily in the form of financial assets and bills can be stocks, bonds and loans, rather than in the form of real assets such as buildings, equipment and raw materials (Rose & Fraser, 1988: 4).

According to Law No. 14 of 1967 on Principles of Banking, which meant financial institutions are all bodies through activities in the financial sector and society to withdraw money and funnel it back into the community. Financial institutions lending to customers or invest funds in securities in the financial markets. financial institutions also offer a variety of financial services and protection from insurance, pension plan to sell the storage of valuables and providing a mechanism for the payment of funds and transfer of funds.

The process transfers that occur between parties who have extra money to those who need funds in general is in need of an intermediary or mediator financial institutions. Intermediation process gives also key benefits:

· First, it provides the opportunity for the unit to invest surplus funds and make a profit, thus helping to mobilize funds to not idle.
· Second, the process will move the risk from savers and surplus units to financial institutions and the users of funds. So the existence of financial institutions is intended to allow the allocation and transfer of funds and the surplus units to the deficit units can be run more efficiently.

Financial institutions in the financial world to act as an organization that provides financial services for its customers, which in general is governed by regulatory agencies of the government’s finances. The general form of the financial institutions are including banking, building society (a type of co-operatives in the UK), Credit union, stock brokerage, asset management, venture capital, cooperatives, insurance, pensions, mortgages and businesses alike. Financial institutions in Indonesia is divided into 2 groups: the banks and financial institutions non-bank financial institutions (insurance, mortgages, securities firms, financial institutions, etc.).

The function of this financial institution provides services as an intermediary between the owners of capital and money markets are responsible for channeling funds from investors to companies in need of funds. The presence of these financial institutions that facilitate the flow of circulation of money in the economy, where the money collected from individual investors in the form of savings, so the risk of these investors turn to financial institutions who then distribute these funds in loans owed to the needy. This is the main objective of the institution to generate income depositors.

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Manage Finance

Using Credit Cards to Finance Your Business

It can be quite difficult to find financing when you are trying to start a business. Traditional channels such as banks and other financial institutions are normally not too eager to finance a new business, even if you have developed a sound business plan and are highly skilled in your market. Starting a business, especially an online business based from your home, can be difficult, and you will need a way to obtain financing. You may be considering using your credit cards to finance your business.

While it is always better to avoid risking your own money when starting a new business, there are many people who have successfully financed a business with credit cards. If you have a sound business plan the ability to manage your finances wisely, you may be able to use your credit card to finance a business without risking your credit score and your financial future. Just as with all debts, it is important to pay as much of your balance as possible each month and never make late payments.

There are advantages to using you credit card in financing a business. It is quick and easy and you will never have to wait for approval or funds when you are ready to make a purchase. Another advantage is that you can make purchases instantly, without having to write a check or supply vendors with check payment forms, as is often a requirement for a new business. It would make the most sense to use only one of your credit cards for business purposes. You will be able to track purchases easily and consolidate your monthly
statement easily.

You should know your billing date. You will be able to make larger purchases just prior to your billing date and prevent interest from accumulating for several weeks until you make your payment. Always try to pay off the majority of, if not all of your debt each month. You will save a lot of money in interest charges by paying as much as you can possibly afford each month.

Using your credit card will also protect you from losses if you receive damaged goods or fail to receive merchandise you have paid for. Depending on the type of credit card you choose to use for your business, you can earn bonuses, frequent flyer miles, and cash back. You will need to monitor your spending carefully. Make certain you use the credit card with the lowest rate of interest and you may be able to contact the credit card company and ask about any possible rate reductions you can get.

Financing your new business with a credit card is not the ideal situation, but for those who are having difficulty obtaining a traditional loan or alternate type of financing, this could be a viable
option. You do not want to risk losing your profits by accumulating overwhelming amounts of debt on your credit card. Keep a close watch on your spending and pay most if not all your debt each month. With caution and a smart business plan you can finance your new business with a credit card and instantly find the funding you need. Depending on your credit situation and debt level, you may be able to apply for a credit card in your company name, separate from your personal finances.

Accumulating credit card debt is never the best option, but with wise decisions and smart purchases you can finance your business and avoid the frustration of trying to obtain outside funding. Starting a new business is an exciting time. Make smart financial decisions and your business can be profitable in a short time.

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Manage Finance

Finance Companies Understand That People Want a Decent Reliable Car

When considering vehicle finance it’s highly recommended to look at all the different packages available. In the current economic climate the rates will be very competitive. Finance companies understand that people want a decent reliable car, if the potential borrower meets certain criteria it could be as simple as going out and choosing your dream car, with no need to settle for just a basic one.

An application for a loan can be approved within an hour in some cases. The loan terms can range from 6 months to 5 years. An older car will have a shorter loan term.

The loan can however be paid off earlier, in these cases an early settlement fee will normally be charged.

If you plan to get a car in a particular price range then the finance will be able to pre approve the amount before you start looking. This makes the selection process easier. Whether you choose a motor vehicle dealer or a private seller the fees will be transferred directly.

It’s normal for companies to have a minimum loan amount of $5,000. The borrower must be at least 18 year of age. Some borrowers will need a guarantor who will be held responsible for any default in payments. Interest rates will often vary considerably depending on a variety of factors. For those with bad credit history the process will be longer and the rates will change.

Specialist finance companies will be able to offer excellent rates and will be able to tailor details specifically to clients needs.

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Manage Finance

Auto Financing Companies For Bad Credit Individuals – 5 Steps to Getting Funded

When one thinks of auto financing, one image that comes to mind is a world of wheeler-and-dealers who are always trying to get the better of the borrowers that come to them for a car loan. One reason for this slightly negative image is that there is no guarantee that you will get approved or that you will be offered a certain rate. Rather, it is up to each lender as to just what type of deal they will offer you on a car loan.

If you were to take a look behind closed doors within an auto dealer’s financing office or that of a bank’s loan manager, you may be surprised to learn that there is a method to their madness. In other words, they are not just taking your application, putting their hand into a hat full of different loan deals, and pulling one out for you.

Rather, there is a surprisingly predictable formula to the way a loan deal is prepared and offered to you when you visit an auto financing company. Obviously, your credit score plays a very big role in it. But, so do things like your employment history, your residential history, and even the way you present yourself in person.

If you have bad credit, you may have had some unpleasant experiences in dealing with auto financing companies. Namely, your car loan application may have been rejected on one or more occasions. Or, maybe you just were not able to qualify for a good loan.

No worries. Here are 5 steps to getting funded (at a reasonable rate) the next time you look for good auto financing companies:

1. Shop for a car in a reasonable price range:

Start by shopping for and choosing a car that is in a price range that makes sense, given your credit situation. You may be tempted to choose the very best car on the lot, but that would be a mistake. Someday soon, no doubt, that super-expensive car, SUV or truck will surely be yours. But, for now, it is time to be realistic about what you can reasonably afford. A smaller loan will mean much better chances of your loan getting funded.

2. Understand how bad credit auto financing companies think:

While 98% of car financing companies focus mainly on the borrower’s credit score as the basis for their lending decisions, about 2% of the companies out there actually look to do business with bad credit individuals. They have built a nice little business on catering to the credit-challenged. These companies look past your credit score and instead consider your situation as a whole when making a decision.

3. Run a credit check on yourself:

This may sound strange, but you will benefit greatly from doing running your own report. Find out your score with all 3 of the top 3 bureaus (since it will vary from one to the next). And, be sure to protest any errors you find on any one of your reports. They are obligated by law to fix them.

4. Take the time to build a healthy list of lenders:

In this case, “healthy” list means 5-7 lenders. Sound like a pain to do that much research? Just think: spending an extra 20-30 minutes doing your homework now could save you thousands in lower interest payments over the life of your loan.

5. Follow through with applying to five or more lenders:

Now, make sure you actually apply to all of the lenders on your final shortlist; be sure you apply to five, at minimum. You never know: the fifth one you talk to may be the one that offers you a 1-2% lower interest rate. That’s money in the bank for you.

Follow these 5 steps to finding the right auto finance company and getting funded.