PIK — Payment In Kind
Definition: Debt where interest accrues to principal instead of being paid in cash. PIK preserves liquidity but compounds the debt load — a useful bridge or a slow-motion blowup, depending on the deal.
Example
In board meetings, you'll often hear something like: "Let's pull the latest PIK numbers before we make a call" — shorthand for payment in kind.
When you'll hear it
PIK shows up most often in board meetings, quarterly business reviews, and strategy off-sites. When someone uses it, they're usually referring to payment in kind — and they expect the room to already know what that means.
FAQs
What does PIK stand for?
PIK stands for Payment In Kind.
What does PIK mean in business and finance?
Debt where interest accrues to principal instead of being paid in cash. PIK preserves liquidity but compounds the debt load — a useful bridge or a slow-motion blowup, depending on the deal.
Where will I hear PIK used at work?
PIK comes up most often in board meetings, quarterly business reviews, and strategy off-sites. It's used as shorthand for payment in kind, so people assume you already know the term.