Asset-based Financing also known as Asset-based Loans is usually recommended for small to medium business enterprises. Now these loans in simpler terms are loans taken out against your assets. 

Assets like your account receivables, inventory, or your property are used as collateral to acquire a loan. But when you put your account receivables or your inventory as collateral, it means putting your future revenue or income as collateral. 

The financial institutions out there impose various rules and guidelines while taking out such loans and do not hesitate to charge you with hefty interest rates. These loans are generally based more on the credit than cash and to secure such loans, you should ensure and read all the terms and conditions regarding it.