Types of capital
In this lesson, you'll learn the fundamental differences between share capital and loan capital—the two main ways companies raise finance.
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In this lesson
- 0:00 Share capital and types of finance
- 0:29 Share capital versus loan capital
- 1:23 Shareholders as owners: voting rights and dividends
- 2:00 Understanding shareholder interests and contracts
About this lesson
You'll discover how shareholding grants you voting rights and dividend participation (proportionate to your stake), while loan capital doesn't, and why this distinction matters for understanding who truly controls a business. We'll also explore the key characteristics of secured and unsecured borrowing, and set the foundation for exploring different types of shares and the process for issuing new capital. This is essential knowledge for Financial Accounting and Financial Reporting papers, where understanding capital structure is critical to analysing company finances and financial statements.
Duration: 3m
Transcript
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