When a firm obtains most of its financing from commercial banks, then its primary method for accessing capital is Indirect Financing.
What is Indirect Financing?
When a person (individual or corporate) access or borrows funds from the financial market such as via a financial intermediary (e.g. banks and other financial institutions), the person has accessed funds indirectly.
The borrower has the advantage of being able to approach multiple lenders in one go.
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