Payroll. New employees. Equipment repair. Seasonal inventory purchases. . Any — or all — of these circumstances can strain cash flow. Many businesses set up a business line of credit (BLOC) before they need financing so no matter what contingency — or opportunity — arises, their financing is already in place. Business Line of Credit advantages include:
- Easy access: Being able to access funds at any time keeps your business running smoothly. Tip: For even quicker cash on demand, look for a financial institution that offers BLOC access via online, mobile and phone banking.
- Flexibility: Unlike a closed-end loan, BLOCs offer the flexibility to tap funds for multiple purchases and uses. From meeting payroll one month to financing new equipment down the road, a BLOC can help keep your business nimble.
- Savings: While credit cards have their place in day-to-day business operations, a BLOC typically offers a much lower interest rate. And you only pay interest on the credit used.
Tip: To save even more, look for a financial institution that doesn’t charge BLOC set-up, annual or transaction fees.
- Credit history: When you've accessed your BLOC, making your payments on time will help build a positive credit history which can help a business establish future accounts or qualify for better loan rates.