Understanding Preferential Creditors in the Liquidation of a Company

Finance11 months ago

Source: Understanding Preferential Creditors in the Liquidation of a Company

Preferential creditors are those who are given priority in the repayment hierarchy during the liquidation of company. This means they are paid before other unsecured creditors. The concept of preferential creditors is designed to protect certain types of creditors who may have provided services or benefits that are deemed critical or are mandated by law to receive priority.