Financial assistance is basically any monetary aid or help that an organization, government or individual gets. The financial assistance might be in different forms like:
- Cost-sharing arrangements
- Welfare payments
- Loans that might be taken from https://www.californiatitleloans.org
Additional examples of financial assistance include government bailouts from companies that are struggling, grants as well as tax allowances.
However, financial assistance has a different meaning when used in public companies. Because, this is in reference to provide assistance to companies in buying its own shares. It might include assistance as well in buying of shares of holding companies.
Public company is any company in which shares can be bought on stock market.
What Exactly is Financial Assistance?
In several jurisdictions, helping in purchase of shares that’s either restricted or illegal. Lawmakers may also approve financial assistance as a way to avert national disaster or to help vulnerable individuals. Governments are providing financial assistance as well in protecting parts of the economy.
Diving in to Different Types and its Meaning
As mentioned, there are different kinds of financial assistance, let us try to have a brief explanation to some:
Grant – this is money in which either national or local government, organization, charity or a private individual gives for particular purpose. In comparison to loans, grant receivers don’t need to pay the money back.
More often than not, grants are used for things like:
- Home improvement
- Community projects and;
Subsidy – with this financial aid, the government directly gives them to companies, farmers as well as organizations. Usually, it is encouraging the production of something, boosting exports or promoting research.
Government may be giving out subsidies as well in order to reduce unemployment, make something to become more affordable and prevent bankruptcy. In some other countries, government may be subsidizing staple food. This is a kind of food in which people are eating on a regular basis and in big quantities. Staple food is a representation of the dominant portion of the standard diet of a country like for instance, in China, they have rice, tortillas in Mexico and then, sorghum in Africa.
Bailout – this financial assistance is in existence whenever a company or several companies in the industry is about to shut down or collapse.
Welfare – this term is typically used to financial assistance when people who have limited resources acquired something from the government. Welfare is aiming to ensure that everybody is mentally and physically healthy, comfortable and secure. In the US, the phrase “to be welfare” is synonymous to receiving financial help from the state.