Banc Star Financial offers revolving and non-revolving business lines of credit that can be used to finance short-term funding requirements, to manage cash flow, to finance receivables, or to take advantage of immediate opportunities when other financing sources would take too long to close. Revolving credit lines remain open and typically impose annual fees and other maintenance costs. Non-revolving lines are lump-sum financings that terminate when the principal balance of the credit line is paid in full.
Credit lines are better suited for operational than strategic purposes, including:
- smoothing out cash flow when business cycles create slowdowns and cash shortages;
- enabling corporations to take advantage of unique, one-time opportunities, such as price reductions from suppliers;
- establishing a foundation for larger credit transactions that rely on business credit history;
- controlling capital by allowing credit to be drawn as needed, rather than in a single transaction.
Our strategy generally utilizes corporate credit lines as an interim or temporary financing option. Credit lines can be an ideal solution for a startup or entrepreneurial company that needs short-term capital during an initial growth phase. Many established companies also use credit lines to fill in gaps and to provide liquidity while other debt transactions are being negotiated.
