Loans come with charges but I did not know what is fixed or floating charge meaning until my cousin explained it to me. So let me give you an idea on both. A fixed charge is the charge secured on a particular property be it land, building shares and more. But a floating charge is available only to companies, a security interest over a group of non-constant assets that can change in value and quantity anytime like stock, inventory, trade debtors and more.
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What is the definition of floating charge?If you want to know
what is floating charge on assets in simple terms, let me tell you that when a debt gets secured in lieu of non-constant assets that are not fixed and can change in value or quantity, it is called a floating charge.
It provides a person with much more freedom than the fixed charge as it does not need the approval from the ldner before selling, disposing or doing other things with the assets.
What are some differences between floating charge and fixed charge?Floating charges apply to all current assets that can change but fixed charges apply to specify assets which will remain all the same
Assets under fixed charges cannot be sold but assets under floating charges can be sold.
This is all I got to know about the floating charge meaning.
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What Is Floating Charge On Assets?
Nafisa
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2022-10-18T09:07:55+00:00 2022-10-18T09:07:57+00:00Comment
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