Business Line of Credit

Access cash when you need it, repay as you go.

Provided by a separate legal entity, Chedr Ltd.

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View Chedr Line of Credit Website
Business line of credit (LOC)

Tap into on-demand access to funds

Only pay interest for what you use.

Terms

$75,000 – $150,000 funding size

18 months
6 months interest only at 5% before amortization (12 months)

Structure and payment schedule

Interest calculated daily

Requirements

Few years in business

680 FICO score

Funding time

Most applications reviewed, finalized, and funded in days

Learn More on Chedr
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Why businesses chose line of credit by Chedr

Save with a business line of credit from Chedr.

Lower costs: early payoff options

Lower costs: early payoff options

Paying off balance ahead of schedule helps reduce overall costs, simplify financial planning, and free up capital for future needs

Savings: six months interest only before amortization

Savings: six months interest only before amortization

Unlike competitors, your first six months is interest-only, then amortization kicks in.

Flexibility to pay down principal faster

Flexibility to pay down principal faster

Chose weekly or monthly payments to match your cashflow, not traditional monthly schedules.

Fast

Fast

Fill out a short application which is reviews and finalized within a few days.

Use cases

Ideal for short-term projects or variable expenses.

Inventory purchase

Inventory purchase

Buy equipment upfront before sales come in. Lock in bulk discounts from suppliers.

Seize growth opportunities

Seize growth opportunities

Respond quickly to new opportunities by launching marketing campaigns, hiring staff, and releasing new products.

Smooth operating expenses

Afford payroll cycles, vendor payments, and software without dipping into reserves.

Bridge gaps between payments

Overcome slow-paying customers, invoice delays, and tap into earnings even if you haven’t been paid.

Cover emergency expenses

Fund unexpected costs including equipment breakdowns, repairs, and compliance issues.

Fill short-term cash flow gaps

Tackle regular expenses like payroll, rent, and utilities even with uneven revenue.

Pros and cons

Consider the benefits and drawbacks of a business LOC.

Pros:

  • Pay interest on what’s used: Pay interest on the amount you draw, not the full credit limit, unlike a traditional loan.
  • Flexible, revolving capital: As soon as you pay you can draw from it again.
  • Reusable: Can be used repeatedly, unlike a term loan.
  • Lower costs: LOC rates are typically lower than merchant cash advance (MCA), short-term daily loans, and revenue advance.
  • Build business credit: Responsible usage may improve your credit profile.

Cons:

  • Qualification requirements: Usually require higher credit scores and more time in business; many need a personal guarantee.
  • Variable interest rates: Floating rates or prime and margin rates can increase over time.
  • Can be pulled or reduced: Banks may freeze a line of credit or not renew, particularly during downturns.
  • Fees may add up: Some LOCs have origination, renewal, and inactivity fees.
  • Over-borrowing risk: Businesses sometimes constantly draw from a revolving LOC or never pay down debt.
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Compare a Business Line of Credit

Use the right drop down to compare a business LOC to other flexible funding options.

Compare with:
Funding Time
Within days
Terms
18 months with six months interest only before amortization; early payoff options
Amount
$75,000 – $150,000
Eligibility
2+ years in business; 680+ FICO
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Compare with:
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Need help deciding?

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FAQ

Can’t find the answer you’re looking for? Feel free to contact us.

A business line of credit (LOC) is a flexible form of small business financing that allows you to access funds up to a predetermined credit limit. Unlike a traditional business loan that provides a lump sum, a revolving business line of credit lets you draw funds as needed and only pay interest on the amount you use.

Many businesses use a business line of credit for working capital, including managing cash flow, covering short-term expenses, purchasing inventory, payroll, marketing, or handling unexpected costs. As you repay the balance, the available credit replenishes, giving your business ongoing access to funding.

Most lenders require a short business funding application along with basic information about your company, such as revenue, time in business, and bank statements.


Once submitted, the application is reviewed to determine eligibility for a revolving business credit line and the maximum credit limit available. Many modern lenders offer online business line of credit applications that can be completed in just a few minutes, helping business owners quickly secure flexible financing for growth and working capital.

Access to funds from a business line of credit can be very fast, especially with online lenders. Once your business credit line is approved, you can often draw funds within 24–48 hours, depending on the lender and verification process.
Because a revolving line of credit for businesses is already approved, future draws are typically even faster—allowing you to transfer funds directly to your business bank account whenever you need additional working capital or short-term financing.

LOCs often have:

  • Draw fees
  • Maintenance fees
  • Annual fees
  • Renewal fees
  • Origination fees
  • Inactivity fees

Several factors help evaluate your company’s ability to repay financing and come into play to determine your credit limit. These factors often include your monthly or annual business revenue, time in business, cash flow stability, industry risk, and business credit profile. 

Yes, your business line of credit may increase as your company grows and demonstrates responsible repayment. If your revolving business credit line is used consistently and payments are made on time, lenders may periodically review your account and offer a higher credit limit.

An increased limit can provide greater flexibility for managing cash flow, purchasing inventory, funding marketing campaigns, or covering seasonal business expenses. Growing businesses often use credit line increases as an ongoing working capital financing solution

Interest rates vary depending on the  lender, the borrower’s credit profile, business revenue, and the overall risk associated with the business. Rates for small business lines of credit are typically competitive with other forms of working capital financing and may be structured as fixed or variable rates.

One advantage of a revolving business line of credit is that you only pay interest on the amount of funds you actually draw, not the full credit limit. This makes a credit line an efficient financing option for businesses that need flexible access to capital for short-term expenses.

With a loan you get a lump sum upfront paid back over time. An LOC provides access to a pool of funds to draw from when needed.

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*Line of Credit is offered by our sister company, Chedr Ltd., a separate legal entity subject to its own terms and conditions. To learn more, please visit Chedr terms and conditions.

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