revolving fund

Thân thiện

A community garden uses a revolving fund to purchase new seeds each season.

Definition

Noun: A sum of money that is continuously replenished as it is spent or loaned out, allowing it to be used repeatedly for a specific purpose. The key characteristic is its cyclical nature: money returns to the fund, enabling new expenditures or loans without requiring new allocations.

Usage

A "revolving fund" is typically established for ongoing operational needs or specific projects. It functions like a pool of capital that turns over. The term is most commonly used in institutional, governmental, or organizational finance contexts.

Examples

• The university established a revolving fund to finance energy-efficient upgrades, using the resulting utility savings to replenish the fund for future projects.
• The small business loan program is supported by a revolving fund; as borrowers repay their loans, the money becomes available to lend to new applicants.
• The manager must ensure the petty cash revolving fund is maintained at a constant level by submitting expense reports for reimbursement.

Advanced Usage

• Self-replenishing: This is a core concept. A well-designed revolving fund is often structured to be self-replenishing through mechanisms like loan repayments, sales revenue, or cost savings generated by its use.
• Capitalization: Refers to the initial amount of money used to establish the fund. A fund must be adequately capitalized to be effective.

Variants and Related Words

• Revolving credit (n): A related financial concept, such as a credit card or line of credit, where the borrower has ongoing access to funds up to a limit as previous balances are repaid.
• Working capital fund (n): A similar type of fund used within organizations to finance day-to-day operations.

Synonyms

• Rotating fund
• Cyclical fund
• Evergreen fund (informal)

Antonyms

• Appropriation (a sum of money granted for a specific purpose, often for a single use or a fixed period)
• Sinking fund (a fund where money is set aside to repay a debt or for a future one-time expense, not for repeated lending/spending)

Học thuật

Noun

1. a fund which, if borrowed or used, is intended to be replenished so it may be loaned or spent repeatedly