Apply for a revolving credit facility

Looking to improve your cash flow with easy access to funds?

Whether you need to make payroll, purchase stock, or bridge cashflow gaps, a revolving credit facility offers flexible financing. A revolving credit facility could be the perfect solution for your business.

What is a revolving credit facility?

A revolving credit facility offers businesses a flexible way to manage their working capital. The facility lets you borrow money when you need it and repay it when you can. You only pay interest on the amount you use, and once you pay back what you owe, you can borrow again without needing to reapply.

It works similarly to a business credit card, but usually comes at a lower cost. It’s a very suitable option for businesses that need to often replenish stock, have fluctuating staff costs, or need to cover any cash flow gaps.

Why choose a revolving credit facility for your business?

  • You’re charged only on what you borrow

    You have the freedom to draw down as much or as little as necessary, whenever you need it.

  • Easy renewals

    Once your term ends, you can easily renew and access more funds if required.

  • Flexible terms

    You can choose terms between 6 to 24 months to suit your business needs.

  • No early repayment fees

    Pay back what you use without worrying about any additional fees for early repayment.

Why use Capitalise to find your revolving credit facility?

  • Get matched with the right lender for your business needs

  • Receive funds within 48 hours, if approved

  • Support from dedicated funding specialists

How does getting a revolving credit facility work?

Here’s how getting a revolving credit facility works with Capitalise: 

  1. We will ask you a few questions about your business, including its turnover, how much you want to borrow and why you need the funds

  2. Get your application matched with lenders who meet your needs

  3. Receive dedicated support from one of our funding specialists will guide you throughout the process

  4. Your funding specialist will send your application to multiple lenders who will review it and decide whether to make an offer

  5. If approved, you'll receive funds in your account in as little as 48 hours.

  6. Pay back only what you use and renew the facility as needed.

How much can you borrow with a revolving credit facility?

Generally, businesses can expect to borrow the equivalent amount to 1 month’s turnover. If you have already borrowed with them and proven to the lender you can keep up with payments, you may be able to extend your credit limit when renewing your facility.

Securely connecting your bank account as part of your application is also a good idea, as lenders appreciate having more and recent data points to make tailored decisions.

Ultimately, the amount will depend on a case by case basis. For example, a strong business with a good credit score and profitable financial accounts might be able to borrow more.

What are the advantages and disadvantages of a revolving credit facility?

Advantages

Disadvantages

A revolving credit facility gives you flexible access to funds whenever you need them, up to your credit limit.

You will need to pay interest on the amount you borrow, and it can get expensive if you carry a balance over time.

You only pay interest on the amount you actually use, not on the entire credit limit.

It can be easy to keep borrowing, which can lead to accumulating debt.

The funds are available quickly, which is helpful if unexpected costs arise, or when new opportunities come up.    

There may be fees like setup fees or maintenance fees, which can add up.

It can help support your cash flow, especially if your business has seasonal fluctuations.

If you carry high balances or miss payments, it can hurt your business credit score.

Once you pay back what you owe, you can borrow again without needing to reapply.

Relying too much on credit could be a sign of financial strain and may limit other growth opportunities for your business.

What do you need to apply for a revolving credit facility?

When applying for a revolving credit facility, lenders will typically ask for:

  • 6 months of business bank statements

  • The latest set of annual accounts (if available)

  • You’ll also need a good business credit score to meet lender requirements and secure the best rates.

Before applying, check your business credit profile to make sure you're in a strong position.

What is the difference between a term loan and a revolving credit facility?

A revolving credit facility involves an interest charge for the period of  time the funds are being used. If a business is not using the funds, they won’t be charged.

Whereas a traditional business loan will require a business to repay the loan on a fixed payment schedule. The business will be given a lump sum agreed upon at the beginning of the loan term and payments will be a fixed amount made each month. 

Here’s some key differences between the two: 

Feature

Revolving credit facility

Term loan

Repayment schedule

Flexible – pay as you go

Fixed monthly payments

Interest rates

Pay interest on used funds only

Fixed interest rate on full loan

Repayment term

Short term (6-24 months)

Can be short term, or long term (up to 5 years)

Early repayment fees

None

May apply

Funding limit

Flexible, based on business turnover

Fixed loan amount

Find out your eligibility for a revolving credit facility