A line of credit is a flexible short-term financial tool that you can use for a variety of business needs, from working capital to purchasing inventory and more. You draw it down as needed and repay weekly or monthly.
A Business Line of Credit, also known as a “LOC” is a type of loan that provides business owners with access to working capital needed to fix cash flow issues and other fulfill other short-term business needs. You draw funds from a line of credit when you need them: Whether it’s once a day, but it also could be once a month or even just once a year.
Unlike a loan, which is generally for one specific purpose, you can use a business line of credit for many different things at once.