A flexible credit line you can draw from whenever you need it.
Get approved once, then draw and repay on your schedule. You only pay interest on what you actually use.
What a business line of credit actually is
A business line of credit is revolving financing — the same model as a credit card, but with cash you can deposit to your business account. You're approved for a maximum limit, and you can draw down any amount, anytime, up to that limit.
You only pay interest on the amount you've drawn, not the full credit limit. As you repay principal, those funds become available to draw again, which makes a line of credit a strong fit for recurring or unpredictable expenses.
Compared to a term loan, a line of credit is more flexible but typically has a higher rate and a shorter term. It's the right tool when you need ongoing access to capital, not a one-time lump sum.
How a line of credit works in day-to-day operations
Once approved, you receive online access to draw funds — either via a transfer to your business checking account or through a debit card linked to the line. Draws typically clear in 1–2 business days.
You pay interest only on the outstanding balance. Most lines have a monthly minimum payment that includes interest plus a portion of principal. Pay it down faster and you free up more capital to draw.
Lines of credit are often used to smooth seasonal cash flow, cover payroll between large receivables, fund a marketing campaign, or jump on a discounted inventory order — situations where the amount and timing of cash need flexibility.
What to weigh before you apply.
Pros
- Pay interest only on what you draw
- Reusable: paid-down principal becomes available again
- Often cheaper than a merchant cash advance or short-term loan
- Fast to access once the line is established
Cons
- Higher rates than long-term traditional loans
- Lender can reduce or close your line if your business profile changes
- Some lines have annual fees, maintenance fees, or unused-line fees
- Personal guarantee usually required
How it stacks up against other funding products.
Questions before you apply.
What credit score do I need?
Lines of credit from $10K–$250K are typically available to business owners with personal credit scores of 600 or higher and at least 6 months in business. Larger lines and lower rates generally require stronger credit and longer business history.
How is this different from a business credit card?
A line of credit gives you cash you can deposit to your bank account — useful for payroll, vendor payments, or anything you can't put on a card. Business credit cards are limited to card-acceptable purchases.
Do I have to use the line every month?
No. Most lines have no minimum usage requirement. Watch out for unused-line fees on some products — we flag those in the offers we present.