Flexible, revolving credit
Business lines of credit for small businesses
A flexible credit limit you can draw on when you need it, repay as cash comes in, and use again.
- Broker, not a lender
- Canada-wide, Ontario focus
- Free initial consultation
- Replies within 24 hours
A business line of credit works a little like a credit card for your business, usually at a lower cost. The lender approves a limit. You draw what you need, when you need it, and generally pay interest only on the amount you’ve used. As you repay, the credit becomes available again.
That makes a line of credit well suited to businesses with uneven cash flow, seasonal sales or customers who pay on terms.
Financing is subject to lender approval and eligibility. We don’t guarantee approval, rates or terms.
Vetri Group is a broker, not a lender. We charge clients a service or consulting fee for our help; lenders and funding partners make all credit decisions.
Common uses
- Smoothing out cash flow between paying suppliers and getting paid
- Buying seasonal stock
- Covering unexpected repairs or expenses
- Taking advantage of supplier discounts for paying early
- Having a safety net in place before you need it
Line of credit or term loan?
A term loan gives you a lump sum up front, repaid in regular instalments over a set period. It suits one-off investments with a clear cost, such as equipment or renovations.
A line of credit suits needs that come and go. It’s usually not the right tool for long-term investments, because a revolving balance that never comes down can become expensive. Many businesses use both: a term loan for a major purchase and a line of credit for day-to-day flexibility.
Secured and unsecured lines of credit
A secured line of credit is backed by business assets (and sometimes personal assets), which can mean a higher limit or lower cost. An unsecured line relies on your business’s strength and credit history, and limits are often smaller. Lenders may also ask for a personal guarantee from the owners.
Lines of credit of up to $150,000 can also be registered under the Canada Small Business Financing Program through participating lenders. More about CSBFP loans.
What lenders typically look at
- Time in business and revenue
- Cash flow, usually from recent bank statements
- Financial statements and tax filings
- Credit history of the business and owners
- Assets available as security, if any
Documents lenders commonly ask for
Every lender is different, but having these ready usually speeds things up:
- Government-issued photo ID for each owner
- Business registration or articles of incorporation
- Recent business bank statements
- Financial statements and/or business tax returns for recent years
- A list of current business debts and payments
- Details of what the financing is for (quotes, invoices or a short plan)
How it works
How we help you get financing
Free consultation
Tell us what the money is for, roughly how much you need and when. We ask about your business, how long you’ve been operating and how it’s doing.
Review your options
We look at your situation and documents and talk through which kinds of financing may fit, including what each one is likely to cost and require.
Prepare the application
We help you put together a clear, complete application and approach lenders that suit your needs.
You decide
If a lender makes an offer, you review the amount, rate, fees, term and conditions before you sign anything. You’re never obliged to accept.
FAQ
Business Line of Credit: common questions
Do I pay interest on the full limit?
Generally you pay interest on the amount you’ve drawn, not the full limit, but some lines also carry fees such as a set-up or annual fee. Check the terms of any offer carefully.
How big a limit can I get?
Limits depend on the lender, your revenue, cash flow, credit and any security you can offer. We’ll help you understand what’s realistic before you apply.
Can a lender reduce or cancel my line of credit?
Many business lines of credit can be reviewed by the lender, and some are repayable on demand. Read the terms and ask us to walk you through them.
Is a line of credit good for buying equipment?
Usually not. Equipment is a long-term purchase that tends to suit a term loan or lease. A line of credit is better for short-term, recurring needs. See equipment financing.
Other financing options
Working Capital Financing
Cover payroll, inventory, rent and seasonal gaps while you wait on revenue.
Equipment Financing
Loans and leases for machinery, vehicles, kitchen, clinic and shop equipment.
CSBFP & Government-Backed Loans
Canada Small Business Financing Program and BDC options for start-ups and growing businesses.
Merchant Cash Advance
Funding repaid from future sales, through our affiliated funding partners. 3+ months in operation.
All business loans
Compare every type of business financing we can help with.
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