Asset-Based Lending (ABL) is a type of financing where a business secures a loan using its assets as collateral. These assets can include accounts receivable, inventory, equipment, or real estate. The amount of financing available is directly tied to the value of the assets pledged.

ABL is particularly suitable for businesses that have significant tangible assets but may not qualify for traditional loans due to less stable cash flows or credit issues. It is ideal for manufacturing companies, wholesalers, distributors, and businesses in sectors with substantial inventory or receivables. ABL is also beneficial for businesses experiencing rapid growth, turnaround situations, or those needing to finance expansions.