Similar to a company credit card, a business line of credit is a finance resource that you can use whenever you need, up to a specified credit limit. You can withdraw different amounts over time to support a range of business needs, be it managing your cashflow, funding growth or covering unexpected bills.
Each figure you withdraw effectively becomes a separate loan which you can then repay either in agreed instalments or all in one go. You’ll only pay interest on the amount you withdraw, not your full credit limit, so it can be a useful option to have if you can’t predict how much you’ll need to use.
There are various types to choose from, too. Sometimes known as a business equity line of credit, a secured line of credit is backed up by your company or personal assets. An unsecured business line of credit meanwhile is not. You may be offered a revolving credit option, where you can borrow money again once you’ve repaid. Non-revolving lines of credit mean you cannot.
But there are reasons why a business line of credit may not be everything you need it to be. You may still be offered less than you’re looking for or have your application turned down due to your credit history. We believe there’s a better way – step forward the Liberis Business Cash Advance.