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The keys to financial leverage

Financial leverage is the translation of the use of the system to achieve great benefits. Above all, companies use it to achieve growth and achieve goals much larger than they could achieve on their own.

One of the main reasons why companies use financial leverage is because with their own income they would not be able to get out of the circle of paying suppliers, employees and re-invoicing, since many companies, especially SMEs, do not use profits for reinvestment and Growth of the company.

In any case, it would not be enough to generate real growth in today’s economy and its great speed.

This is why knowing how to access financial leverage and knowing how to use it well is the difference between a stagnant company and a successful one.

The main keys to financial leverage are in its use, once it is achieved, it should be used to invest, buy productive assets and focus on growth, not on meeting past debts or sustaining a non-profit business, unless this is part of a very well structured plan.

Assets are the key to financial leverage, using them as collateral to be able to access credit is the best tool that companies have to access it.

Buying liabilities is not appropriate when business financial leverage is achieved, since interest rates, inflation and in some cases the same fiat currency devaluation make these liabilities lose their value very quickly.

We recommend structuring a financial leverage plan, saying yes to responsible debt and taking advantage of the credit system that you can now access with multiple services at Efinti.com.

 

At Efinti we only have one path for MIPYMES: Grow without Borders!

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