Overview
A flexible line of credit for seasonal cash flow, payroll and unexpected opportunities.
Highlights
- Draw funds as needed.
- Interest on the outstanding balance.
- Revolving access during the available period.
- Local credit decisions and support.
How a line works
A business line of credit lets a company draw funds as needed, repay them, and draw again during the available period.
- Useful for seasonal cash flow and timing gaps.
- Interest is generally charged on the outstanding balance.
- A variable rate can change with the market.
- The lender may review the line periodically.
Compare with a term loan
A term loan provides a fixed amount with a defined repayment schedule. A line is more flexible but requires discipline.
- Term loan: predictable payments for a one-time need.
- Line of credit: flexible access for recurring needs.
- Consider the total cost, not just the rate.
- Match the structure to the cash-flow cycle.