Working capital · line of credit
Revolving funding without the bank overdraft hurdles.
Same draw-as-you-need flexibility as an overdraft, usually with simpler approval. Non-bank lenders dominate this space and approve faster than the majors. Best for businesses with regular but unpredictable cashflow needs.
What it is, when it fits
Plain English, with the trade-offs.
A business line of credit is a revolving facility you draw from as you need it. Unlike a term loan, you don't take the full amount up front; you draw and repay as cashflow dictates, paying interest only on the drawn balance. Unlike a bank overdraft, the line is usually a separate facility (not attached to your operating account), set up by a specialist non-bank lender or fintech rather than a major bank. That separation comes with a real benefit: faster set-up (often days, not weeks), lighter documentation, and pricing that's only slightly above unsecured term loans. The trade-off is rate. Lines of credit run 9% to 22% p.a. on drawn balance, higher than a bank overdraft but materially lower than recurring unsecured term loans for businesses that draw and repay frequently. They're a good fit for ecommerce smoothing payment-processor cycles, B2B services with 60-day customer terms, or importers funding the gap between landed costs and receivables.
Ecommerce operator packing orders in a small warehouse.
Typical scenarios
Ecommerce business smoothing payout cycles
Why: Stripe and PayPal payouts on rolling 7-14 day cycles; ad spend continuous.
Outcome: $80K facility, drawn weekly to fund ads, repaid as each payout clears.
B2B services with 60-day payment terms
Why: Payroll monthly, customer payment 60 days after invoice.
Outcome: $200K facility, drawn for 30-45 days each cycle, repaid as receipts clear.
Importer bridging landed-cost gap
Why: Goods land 30 days before customer payment; cycle continuous.
Outcome: $300K facility, drawn against each shipment, repaid on customer settlement.
SaaS managing seasonal subscription patterns
Why: Annual subscriptions cluster, monthly costs continuous.
Outcome: $150K facility used 4-5 months a year, free the rest.
Lenders for this product
Who we work with.
- GetCapital
- Prospa
- Bigstone
- Capify
- Banjo Loans
- Lumi
Lender accreditation varies; not every lender is available for every deal. We pick from the panel based on your specific situation.
How it works
From brief to settlement.
- 01
Cashflow shape review
A 20-minute call to understand how the facility would actually be drawn (frequency, peak balance, repayment pattern). Pricing varies meaningfully by usage profile.
- 02
Lender shortlist
We submit to the two or three lenders with the strongest current appetite for your trading shape, not the entire panel.
- 03
Approval and set-up
Approvals typically return inside 48 hours. We translate the offers into effective annual cost on your expected usage so the comparison is honest.
- 04
Live facility and ongoing
Facility goes live within days of approval; you draw and repay through the lender portal. We check the facility at 6 and 12 months in case the rate or limit needs adjusting.
Indicative pricing & terms
Ranges, not promises.
Rate range
9 to 22% p.a. on drawn balance
Loan size
$10K to $500K facility
Term
12 to 36 months, often rolled at term-end
Security
Usually unsecured to $250K; over that, business assets
Indicative only; specific pricing depends on lender, security, and your business profile.
Frequently asked
Honest answers, plain English.
How is this different from a business loan?
A term loan disburses the full amount on day one and you repay it across the term. A line of credit lets you draw and repay across the term, paying interest only on the drawn balance. For lumpy or recurring cashflow needs, a line of credit usually costs less in total interest than running a series of term loans.
Do I pay interest on the unused portion?
No, interest only accrues on the drawn balance. Most lenders charge a small ongoing facility fee (typically $10-50/month) to keep the facility available, but it's a fraction of what an unused balance would cost in interest.
Can I top up the facility later?
Yes, most lenders increase the limit on request once trading data demonstrates you can service a higher balance. Increases usually require a brief data refresh rather than a full re-application.
When does this beat an overdraft?
When set-up speed matters (days, not weeks), when you don't want to switch operating banks, or when bank policy doesn't fit your trading profile (newer business, recent restructure, niche industry). The trade-off is a higher rate; for businesses that draw frequently, the speed and policy flexibility usually justify it.
Can a sole trader get a line of credit?
Yes, several lenders on the panel approve sole traders with at least 12 months of ABN history and clean banking data. Pricing tends to sit at the higher end of the range, and limits are usually capped lower until trading scale demonstrates capacity.
Related products
If this isn't quite the fit.
Next step
Twenty minutes, no obligation.
Tell us the shape of the deal and the timing. We'll send a lender shortlist for line of credit or, if it isn't the right fit, an honest signal of what is.