A business credit facility makes it easier for companies to finance business expenses. Moreover, there are several forms of business credit to choose from.
What is business credit?
Business credit is a commercial financing option that frees up funds for your company and helps cover expenses.
Examples of business credit
There are different types of business credit, such as:
- Accounts receivable financing: you receive an advance on outstanding invoices, simplifying receivables management. This works seamlessly with complete accounts receivable management software such as Payt.
- Overdraft facility: the ability to temporarily overdraw on your current account.
- Business loan: financing investments or renovations.
- Business leasing: for example, financing a company car.
- Commercial mortgage: when purchasing real estate.
Advantages of business credit
Business credit offers multiple advantages for entrepreneurs, such as additional working capital. This enables you to meet short-term obligations while still having room for purchases and investments.
- Working capital flexibility: meet payment obligations and manage liquidity.
- Reduced payment risk: with accounts receivable financing, you gain an advance.
- Asset acquisition: use loans to buy business assets or renovate.
- Leasing benefits: finance company vehicles through business leasing.
- Financial space: overall, business credit provides room to grow and manage cash flow more effectively.
