DIP financing, sometimes referred to as debtor in possession financing or debtor in possession, is a type of liquidity for businesses that are still operating while providing the security of their assets. Many business owners use it when they need extra financial support to operate and maintain their enterprises.

DIP finance is a specific kind of financing that businesses utilize to operate and expand when they need more money but their current business operations don't offer enough collateral for more conventional bank loans. Such borrowers continue to be the legal owners of all or nearly all of their assets even when they are using them, which is why it is known as "debtor in possession."
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