Describes something that cannot be converted into physical currency or easily exchanged for money. This applies to assets, benefits, or financial instruments that lack immediate liquidity, meaning they cannot be readily accessed or realized as cash. This might be due to legal restrictions, market limitations, or the nature of the asset itself. The term highlights the illiquidity of an item, differentiating it from items that can be readily converted into cash, like checking accounts. Factors such as restrictions or complex conditions often make the asset non-cashable.
Non-cashable meaning with examples
- The employee's stock options were initially non-cashable, vesting over a period and subject to company performance. They couldn't immediately exchange them for cash. Therefore, she could only see the value of her stock growing on paper. These options eventually transformed into cash when vested and sold on the market, showing how non-cashable instruments can become liquid.
- Government subsidies for infrastructure projects often come in the form of non-cashable tax credits. Contractors can't directly spend these credits as money; instead, they reduce future tax liabilities. This form of non-cashable payment supports various initiatives that are often seen as essential for community well-being and economic expansion.
- Rewards programs frequently offer non-cashable points that can only be redeemed for merchandise, services, or travel. These rewards are great but cannot be redeemed for actual cash. They incentivize repeat business and provide a non-monetary benefit to customers, illustrating how businesses leverage non-cashable rewards.
- A charitable donation might be in the form of non-cashable assets, like a building, which are then liquidated over time to fund its operations. The organization could benefit significantly from the assets. The time it takes to turn the assets into cash, however, underscores the non-cashable characteristic, requiring an investment in time and resources.