A finance company is a type of financial institution that specializes in providing loans and other financial services to individuals and businesses. Finance companies typically offer a wide range of loan products, including personal loans, auto loans, home loans, and business loans.
Finance companies often have more flexible lending criteria than traditional banks, which can make them more accessible to borrowers with lower credit scores or limited credit history. However, finance companies may charge higher interest rates and fees than banks, reflecting the higher risks associated with their lending activities.
In addition to lending, finance companies may also offer other financial services such as insurance, investment management, and financial planning. Some finance companies specialize in serving particular markets or industries, such as equipment finance companies that provide financing for businesses to acquire machinery or technology.
