Working capital refers to the funds that a company uses to manage its day-to-day operations. It is the difference between current assets (such as cash, inventory, accounts receivable) and current liabilities (such as accounts payable, accrued expenses) of a business. Working capital finance is important to ensure a company has enough liquidity to cover its short-term expenses, pay bills, and invest in new opportunities. This type of financing can be obtained through various methods, including bank loans, lines of credit, trade credit, and factoring.