Working Capital Loans

The Basics on Working Capital Loans

Working capital is a great tool to give your business a boost of liquidity. Working capital can be used to purchase inventory, hire employees, and any other intangibles. Short and long terms are available. Loan amounts and terms are based mainly on information obtained from your business bank statements, and not so much on your personal credit score.

 

What Are Working Capital Loans? 

As mentioned, a working capital loan is a kind of business loan that can assist when your company finds itself in a tight financial spot for a number of reasons. This type of business funding isn’t used for any long-term investments but rather is reserved for short-term financial needs.

Working Capital 

Working capital (also called net working capital) is the difference between a business’ current assets and its current liabilities. Assets can include accounts receivable, inventory, and cash on hand. Liabilities can include accounts payable and any payments due for debts in the next 12 months.