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Business Operating Lines of Credit
An operating line of credit (LOC) is a revolving loan disbursed into your operating account in order to meet day-to-day cash flow requirements. This could include covering short term cash requirements, taking advantage of supplier discounts or covering seasonal working capital needs.
The LOC is normally repaid as the business generates cash flow from operation of the business. While the loan is repayable on demand, there is no fixed repayment schedule except for interest, which is due and payable each month. It is normally secured by accounts receivable, inventory and other business assets and may be renewable annually.
