Business lines of credit are, quite frankly, amazing. There are limitless situations where you can use them and virtually no downsides. True, this type of credit carries higher interest rates (less than a credit card but more than a loan), but you only pay interest on what you use. With smart management, this is literally one of the best financial tools available to modern business owners. Here are several reasons why you need to apply for business credit, if you haven’t already.

It Gives You Working Capital

One of the most important things business owners need is working capital. This refers to money that you can use however you want, unlike loans that carry specific spending requirements. With working capital, you can invest in new equipment, pay your employees, hire a web designer to create a website, take your digital marketing to the next level or take care of hundreds of other needs. Many business owners use working capital to purchase inventory, and others turn to this financing option to hire additional employees.

The beauty of working capital via business credit is that you make the call every time. You don’t need to request approval from the bank. You manage your account however you want, when you want. This gives you amazing flexibility.

It Provides an Emergency Safety Net

Remember how we said that you only pay interest on the amount of financing you use? That turns a business line of credit into fantastic emergency financing. Whether you’re going through a slow period of sales or your business was hit by a natural disaster, you can use this financing option to get through it intact. This type of financing frequently offers a cap that is large enough to repair or replace broken equipment, take care of operating expenses for many months, pay taxes, manage payroll and make sure essential bills get paid.

It Adapts Well to Seasonal Needs

Another benefit of business lines of credit is that they’re perfect for seasonal business layouts. Lawn care companies, construction businesses — even manufacturers often have busier and slower times of year. With business credit, you’re always ready for anything. For one thing, credit can supplement your cash flow during slower times. Also, you can afford to hire extra employees during the holiday rush. You decide what to pay, how to pay it and when. This can improve your company’s financial health significantly. Even better, a line of credit always adapts to the specific needs of your business.