Cover cash flow gaps with a business line of credit

A business line of credit is revolving credit — meaning you can repeatedly access funds up to a predetermined limit and pay back the balance over time. As you pay down the balance, those funds become available to borrow again. For that reason, a business line of credit is best for funding short-term operating and working capital needs. Business loans, on the other hand, give you access to a lump sum of money that you pay back in equal payments over a set period of time. Business loans are more suitable for funding longer-term growth needs, like purchasing an asset for your business.

Business lines of credit and business credit cards are both revolving credit facilities. Each solution gives you access to credit up to a predetermined limit and allows you to access funds again as you pay off your balance. Each has a role to play in your business. Credit cards provide a convenient, widely accepted payment method, but generally charge higher interest rates than lines of credit‡. Business lines of credit work well for day-to-day operating needs, as they are attached to your business chequing account and can help cover short-term gaps in cash flow or purchases that you intend to pay off in the short term at a lower interest rate.

You can access funds through Coast Online Banking and any ATMs (fee-free at any ATM on the EXCHANGE network).

Business lines of credit have a variable interest rate that moves as Coast Capital’s Prime Rate changes. Your rate will be determined by a number of factors, including your credit history.