How An Unsecured Business Line of Credit Promotes Growth

By Provident Commercial Capital October 19, 2015 No Comments

No matter how long you have been in business, one of the most crucial elements for survival is access to cash. When sales and the economy are down, a company can fail without having cash on demand. This is why an unsecured business line of credit can be one of the best choices for gaining access to this cash. Many owners need to access funds at anytime and when they need it. This credit option can provide that opportunity with flexible payment options and at a competitive rate.

How an Unsecured Business Line of Credit Works

There are two types to consider for a line of credit: nontraditional and traditional. The traditional option is issued by a bank and requires a large amount of qualifying documentation, including tax returns, registration documents, and bank account information. To maintain the credit, an annual financial review is required. The nontraditional option is often the most preferred method because it can provide a quicker access to cash without all the documentation and yearly reviews.

How Can it Help Your Business Grow?

An unsecured business line of credit can grant you fast access to cash so you can use as much credit as you want at any time. This can create more growth, investment and financial opportunities for your company. Your company can also benefit from high credit limits making it more convenient to make larger purchases. Owners can also have an easier time separating business and personal expenses with the cards, making it possible to determine the creditworthiness of the company. You can also benefit from more financial protection. Owners can protect both the company’s as well as their personal financial ratings.

Increased Flexibility for Payment Options

With a line of credit, you can avoid the monthly payments for loans and take advantage of flexible payment options. You can have three different options for your payment each month: pay the minimal amount due, pay the full amount due or pay more than the minimum portion due. These different options are ideal for a company that often experiences varying ups and downs within the market. If sales are slow one month, you can take advantage of the minimum payment option. If your company had a great economical month, you can pay off the full amount.

Manage Your Finances Each Month for Continual Growth

While paying the minimum payment each month is tempting, owners should also consider accumulating debt. It is important to try to establish a fixed payment schedule to avoid outstanding balances. With flexible options, the owner can adjust the payment amount according to sales and revenue accumulated each month. No matter what type of services your company offers, an unsecured business line of credit is an essential component for managing finances and continuing growth.

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