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“borrowing from domestic markets may involve fixed or floating charges on corporate assets as security for loans.”
i don’t understand the specific part where it says that, “fixed or floating charge on corporate assets”. So either we give current assets(floating in nature) or non-current assets(fixed in value more or less) as our collateral. But charge(“charges on corporate assets”) on collateral sounds like a very strange idea.
It is not referring to current assets.
A fixed charge means that the loan is secured on specific assets – so the lender takes them if the company collapses.
A floating charge means that the loan is secured on assets in general – so the lender shares any proceeds from them with any others lenders who are secured in the same way.
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