Revolving Credit & Overdraft Lines
A committed limit you draw and repay as often as the cycle demands. Interest accrues on the drawn balance only, so a line that sits idle through a strong quarter costs little more than the commitment fee.
SKY Financial Solutions/Short-Term Funding/Working Capital
Section E · i
Working Capital
Profitable businesses run out of cash between the invoice and the payment. A revolving line sized against the real conversion cycle covers that trough — you draw when you need it, repay when the receivable lands, and pay interest only on what is actually out.
Borrowing-Base & Asset-Backed Structures
The limit flexes with the collateral pool — eligible receivables and inventory, advanced at agreed rates and reported monthly. Growth lifts the available limit automatically instead of triggering a fresh credit application every time the order book expands.
Receivable-Led Funding
Where the gap is the sales ledger rather than the whole cycle, the cleaner answer is usually to fund the invoices directly — released on issue instead of on payment. That sits under its own heading: bill discounting.
Payroll, Supplier & Inventory Buffers
Predictable liquidity for the outgoings that cannot wait: WPS payroll runs, supplier settlement discounts worth taking, and stock build ahead of a season you can already see in the order book.
How the limit gets set
- Cash conversion cycle — receivable days plus inventory days less payable days, applied to monthly cost of sales, gives the funding gap the line has to bridge.
- Advance rates — lenders typically advance against verified trade receivables inside terms and, at a lower rate, against finished inventory; ageing and concentration reduce both.
- Debtor quality — the credit assessment runs on your customers as much as on you, so a well-rated debtor book raises the limit more than a strong balance sheet alone.
- Reporting discipline — borrowing-base structures need a monthly ageing and stock report; a business that cannot produce one will be offered a fixed limit instead.