A business line of credit gives you a set borrowing limit you can draw from whenever you need it — and you only pay for the portion you actually use. As you repay, your available credit replenishes, making it one of the most flexible ways to manage uneven cash flow.
What a business line of credit is
A line of credit works more like a flexible reserve than a one-time lump sum. You’re approved for a maximum limit, then draw against it as needs come up. You pay interest only on the outstanding balance — not on the full limit — and as you pay it down, those funds become available to draw again. That’s what makes it revolving.
How it works
- Get approved for a limit. For example, a $50,000 line.
- Draw what you need. Pull $10,000 today and the rest stays available.
- Pay interest only on what you draw. Undrawn funds don’t accrue interest.
- Repay and reuse. As you pay down the balance, your available credit refreshes.
Typical limits and terms
- Limits: commonly $5,000 to $250,000.
- Structure: revolving — draw, repay, and draw again.
- Cost: interest on the drawn balance; some providers charge a small draw fee.
- Speed: once the line is set up, draws can be near-instant.
These are typical ranges for illustration, not an offer.
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Check eligibility →When a line of credit makes sense
It tends to fit businesses that want a flexible buffer rather than a single lump sum:
- Managing ongoing or unpredictable cash-flow swings.
- Keeping a safety net ready for emergencies or quick opportunities.
- Covering recurring short-term gaps without re-applying each time.
What you’ll typically need
- Around 6+ months in business.
- Roughly $20,000+ in average monthly revenue.
- Recent business bank statements.
Frequently asked questions
How is a line of credit different from a loan?
A term loan gives you one lump sum repaid on a fixed schedule. A line of credit is revolving — you draw what you need, repay, and draw again, paying interest only on the outstanding balance.
Do I pay anything if I don’t draw?
You generally only pay interest on the amount you’ve drawn. Some providers may charge a small maintenance or draw fee — terms vary by provider.
Does my available credit come back?
Yes. As you repay your balance, that amount becomes available to draw again, which is why it’s called revolving credit.
How fast can I access funds?
Initial setup is similar to other funding, but once your line is established, individual draws can often be accessed quickly.
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See my funding options →This page is for general educational purposes and is not financial advice. Access Funding Network is a free matching service, not a lender. Funding products, amounts, rates, and terms are offered solely by independent third-party providers and are subject to their underwriting. Amounts and terms shown are typical industry ranges for illustration only and are not an offer or guarantee. Not all applicants will qualify or be matched.