A business model that an entity applies with the objective to hold a financial asset for the purpose of collecting the contractual cash flows from the asset rather than with a view to selling the asset to realize a profit or loss.

A hold-to-collect business model does not always require that financial assets are held until maturity (HTM financial asset). As a general rule, it is expected that sales (intention to sell) would be incidental to this business model and consequently an entity will have to assess the nature, frequency and significance of any sales occurring. In other words, the business model requirements are usually flexible and it allows for deviations from its key defining characteristics in certain cases. For example, in a hold to collect model, sales are allowed where an asset has deteriorated in credit quality, enabling an entity to avoid losses rather that sticking to the asset until maturity.