Business Line of Credit
What is a business line of credit?
In most layman terms, a business line of credit is similar to a credit card. With a line of credit, a lender provides an ongoing commitment to a business by setting up a credit limit to use it based on their requirements. The lender only charges interest on the funds utilised by the business.
Business owners can greatly benefit from having a line of credit by allowing more flexibility to a business in terms of managing cash flows. It is considered an essential product for any business especially in emergency situations. Business line of credit is also referred to as “Revolving Line of Credit ” or simply “Line of Credit” or a “Business Overdraft”.
Business line of credits are good for businesses which have short term cash flow fluctuations and can be very economical if utilised efficiently.
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