A wholly-owned subsidiary that handles the credit function for the parent ﬁrm is called a(n):

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A wholly-owned subsidiary that handles the credit function for the parent firm is called a captive finance company. This type of subsidiary provides financing to customers of the parent company for the purchase of its products or services. The captive finance company is controlled by the parent company and can provide more flexible financing terms and conditions compared to traditional lenders.

A Wholly-Owned Subsidiary That Handles the Credit Function for the Parent