Part I Introduction, 2 Use of security and quasi-security interests in debt financing
Hugh Beale, Michael Bridge, Louise Gullifer, Eva Lomnicka
- Assignment of credit — Guarantees and security — Debt
This chapter explains how security and quasi-security interests can be used wherever a party who is owed an obligation wishes to have a proprietary claim over an asset of the obligor, to which it can have recourse if that obligation is not fulfilled. They are used widely in the context of debt financing of businesses, to secure borrowing and other forms of finance extended by banks and other financial institutions. They are also used to secure credit extended to businesses by those contracting with them, in any situation where a business does not have to pay immediately for benefits conferred on it by the counterparty, and also where a business may become liable to a counterparty in the future.