Business Line of Credit & Revolving Capital

You're approved for a maximum credit limit (e.g., $100K). You can draw any amount up to that limit at any time. Interest accrues only on drawn amounts. As you repay, those funds become available to draw again. It's the most flexible form of business financing available.

A term loan gives you a lump sum upfront with fixed monthly payments over a set period. A line of credit gives you ongoing access to capital you can use, repay, and reuse. Lines are better for managing cash flow and covering variable expenses. Term loans are better for one-time purchases.

Yes. Several lenders offer business lines of credit to owners with credit scores of 600-649. These typically come with higher rates (15-25% APR) and lower limits ($10K-$50K) compared to prime products. Consistent on-time payments can lead to rate reductions and limit increases within 6-12 months.

Once your line is established, most lenders allow same-day or next-day draws via online portal, mobile app, or business debit card. The initial setup takes 3-7 days for approval and 1-2 additional days for account activation.

For amounts over $10K, a line of credit is almost always better. Interest rates are lower (7-25% vs. 18-29%), limits are higher, and there are no transaction fees. Business credit cards are better for small daily purchases and earning rewards. Many businesses use both strategically.

Most lenders require at least $100,000 in annual revenue for a business line of credit. Higher credit limits ($250K–$500K) typically require $300,000–$500,000 in annual revenue. Some fintech lenders offer lines starting at $50,000 annual revenue for established businesses with strong bank statement history.

A secured business line of credit requires collateral—business assets, real estate, or equipment—in exchange for lower rates and higher limits. An unsecured line requires no collateral but has stricter credit and revenue requirements and typically higher rates. Bankable offers both options; most lines under $250K are unsecured for qualified businesses.

You only pay interest on the amount you draw, not the full credit limit. For example, if you have a $100K line but draw $30K, you pay interest only on the $30K. Interest accrues daily on the outstanding balance. As you repay the principal, the available credit replenishes (revolving structure). Most business lines charge interest rates between 8% and 25% APR depending on creditworthiness.

Most lenders require 1–2 years in business for a line of credit. Businesses under 1 year old have limited options, primarily from fintech lenders who use revenue-based underwriting. After 12 months with $10K+ monthly revenue, many lenders will consider your application. Bankable can assess your current options through the Bankability Score even if you are pre-revenue.

Opening a business line of credit may result in a hard inquiry on your personal credit if a personal guarantee is required. Ongoing usage typically does not affect personal credit because business credit activity is reported to business credit bureaus (Dun & Bradstreet, Experian Business), not personal bureaus. However, if you default, personal credit can be impacted through the personal guarantee.

Business lines of credit are among the fastest funding products available. Online lenders and fintechs can approve and fund in 24–72 hours for amounts under $100K. Traditional bank lines take 2–4 weeks. SBA-backed lines (CAPLines) follow standard SBA timelines of 30–60 days. Bankable typically delivers funded lines within 3–7 business days.

Common fees include: origination fee (1–3% of the credit limit), annual maintenance fee ($150–$500), draw fee (1–2% per draw at some lenders), and prepayment penalties (rare on lines of credit). Always ask for the APR (Annual Percentage Rate) including all fees to compare offers accurately. Bankable discloses all fees before you commit to any funding product.