2. Finance companies, also known as financial companies, are extremely important financial institutions in western countries. Raising funds mainly depends on issuing commercial paper in the money market and issuing stocks and bonds in the capital market; They also borrowed money from banks, but the proportion was very small. The collected funds are used to provide loans to consumers and small businesses who buy durable consumer goods and repair houses.
3. Financial companies are divided into three categories: sales finance companies, consumer finance companies and industrial and commercial finance companies. Some financial companies are established by their parent companies to help promote their products. For example, the Ford Motor Credit Company established by Ford Motor Company provides consumer credit to consumers who buy Ford cars. Finance companies have different functions from general long-term investment companies. The former mainly meets the needs of industrial and commercial enterprises for long-term funds, while the latter mainly focuses on small and scattered monetary funds for securities investment.