Having sufficient working capital is a key to every successful business — it gives you the flexibility to invest in your company’s growth, while ensuring that you have the bandwidth to cover day-to-day expenses.
Working capital loans can help you pay for everyday business expenses such as rent, payroll and debt payments. However, they should not be used for long-term investments.
Ideally, you’d establish a line of credit with a bank before experiencing a cash-flow crunch, because banks offer the lowest financing rates. But if the bank says no or you need cash fast, you can turn to alternative lenders. Many working capital loans can be used for multiple business needs, so consider your use of proceeds before you apply.