Working Capital Financing 101: Definition, Types & Tips
What exactly is working capital financing? What are the methods of financing working capital? We have the answers for you.
A cash flow loan is a term loan provided based on your company’s past and forecasted cash flow. It is typically used by e-commerce businesses to fulfill working capital needs, such as payroll and inventory.
As a form of unsecured loan, cash flow loans do not require pledging of tangible assets as collateral. You may, however, be required to sign a personal guarantee over the loan.
Cash flow loans are suitable for e-commerce companies which are currently in short supply of working capital, but expect strong cash flows in the future.
For the following types of businesses, cash flow lending could also give you access to capital which may not be available via other routes:
Grow your business with Choco Up
What exactly is working capital financing? What are the methods of financing working capital? We have the answers for you.
In less than 5 minutes; we’ll convince you on why your e-commerce business should use revenue-based financing (RBF).