This is why it is so important to have a funding solution in place, and revolving credit can be the ideal solution. This is simply finance to which you have approved access. You can draw down on these funds when the need arises and normally you will only pay interest on the amount you have borrowed. When you pay back, your credit available goes back to the original amount.
The advantage of revolving credit is that, unlike some other forms of business finance, it doesn’t come with a set repayment plan that might not fit with the way cash flows in and out of your busIness.
Traditionally, a revolving credit line has been a business overdraft provided by your bank, but access to this type of business finance has been steadily reducing.
Alternative lenders such as Just Cashflow have recognised this and we have introduced our Revolving Credit Facility that works exactly in the same way as a bank overdraft and allows growing companies to smooth out the peaks and troughs.
Interest is charged on a daily basis and there is no long-term commitment, so it provides complete flexibility for the borrower.
There are many things Covid-19 will change but understanding and managing the cash in your business isn’t one of them.