What investment solutions for a company with excess cash

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When companies generate cash through good management, the opportunity to invest and grow this surplus often turns into a real headache … It is common for these funds to sleep on bank accounts, while well placed, they could become an additional source of income. In this case, the officer, by virtue of the statutes of which he benefits, may opt for different uses of his money.

The investment of cash in money market funds

The investment of cash in money market funds

The most traditional solution, always used by companies, is the investment of cash in money market funds. They are indexed to the day-to-day return on money and do not, in absolute terms, represent the capital risk.

Nevertheless, when the expected returns are lower than the management fees charged by the management company, there is a possibility of a negative return.

The other traditional solution for placing corporate cash is the term account

The other traditional solution for placing corporate cash is the term account

The other traditional solution for placing corporate cash is the term account (CAT). Subscribed free of charge, the term account allows you to place your cash on a fixed term and with an interest rate defined in advance. Its major asset lies in the certainty of recovering the invested capital, on the scheduled date, plus interest.

An investment in CAT is ideal for the stable cash flow of the company. Unfortunately today, with key rates at historical minimum, this investment pays almost nothing and any exit before the time is heavily penalized.

Finance the real economy

Finance the real economy

Less known but more rewarding, Good lender allows companies to lend money to other companies. With no management fees and no investment ceiling, Good lender platforms offer the opportunity to support the real and local economy.

Convinced by the simplicity and yield of this product, the leaders are more and more seduced by this innovative opportunity. Credit en, among the market leaders, counts beside its 20 000 private lenders more than 420 lending companies registered on its site. In 2016, they achieved an average return of 7.59%.

As an executive, would you choose the Good lender to place your cash surplus?