image

> >

What are the different types of working capital?

Quick apply

Just takes 60 seconds to apply

Please enter your first and last name
Please enter 10 digit mobile number
Please enter your Birth date
Please enter valid PAN card number
Please enter your pin code
Please enter your personal email id

I authorize Bajaj Finserv representative to call /SMS towards this application and other products/services. This consent overrides my registration for DNC/NDNC. T&C.

Thank you

What are the different types of working capital?

Working capital can be categorized basis:
1. Balance sheet view
2. Operating cycle view

I. Balance sheet View:
Here categorization is done on the basis of the components of working capital:
• Gross Working Capital
This simply means the total block of current assets available with a firm. The block of current assets mainly comprises debtors, stock, and prepaid expenses.
• Net Working Capital
The current assets available after subtracting the current liabilities owed by the firm, in the form of creditors, outstanding expenses, and unpaid taxes, constitute the net working capital of the firm.

II. Operating Cycle View:
Here the classification is done on the basis of the time required to convert stock into cash:
• Permanent or Fixed Working Capital
This is completely dependent on the requirement of the firm. Every firm must allocate a fixed amount below which the overall level of working capital must not fall. This minimum level of working capital is called permanent or fixed working capital. A shortfall in this, can be met with funds from a working capital loan.
• Temporary or Variable Working Capital
The difference between the net working capital and permanent working capital can be termed as temporary or variable working capital.

Businesses can decide the kind of working capital they need to adopt basis their overall business strategy and plan.

People Also Considered

Machinery Loan People Considered Image

Machinery Loan

Funds to upgrade machinery
Up to Rs. 30 lakh | Pay only interest as EMI

KNOW MORE
Business Loan for SME- MSME People Considered Image

Business Loan for SME-MSME

Hassle-free finance for your enterprise
Up to Rs. 30 lakh | Approval in 24 hours

KNOW MORE
Business Loan for Women People Considered Image

Business Loan for Women

Avail customized loans
Up to Rs. 30 lakh | Minimal documentation

KNOW MORE
Working Capital Loan People Considered Image

Working Capital

Manage operational expenses
Up to Rs. 30 lakh | Flexible tenor options

KNOW MORE