A line of credit and a working capital advance both exist to cover the gap between paying for things and getting paid. They differ in how you draw the money, what you pay for it, and how hard they are to get.
How each one works
A business line of credit is a limit you can draw against repeatedly, paying interest only on what you use. A working capital advance is a lump sum delivered once, repaid over a fixed period or as a percentage of revenue, with the total cost known in advance.
| Line of credit | Working capital advance | |
|---|---|---|
| Access | Draw and repay repeatedly | One lump sum, renew when repaid |
| Cost | Interest on drawn balance, plus fees | Fixed factor or rate, known up front |
| Approval | Credit-heavy, often bank-level documentation | Revenue-based on bank statements |
| Speed | Days to weeks for a bank line | Same day |
| Best for | Ongoing small draws, strong-credit owners | A defined need now, variable-revenue businesses |
Where a line of credit wins
If you have strong personal credit, two or more years of history and the patience for a bank application, a line of credit is the cheapest ongoing cushion. You draw $8,000 for a repair, repay it in six weeks and pay interest on six weeks.
Where an advance wins
If the need is defined, the timeline is today, or the credit profile would not clear a bank, a working capital advance is the practical tool. Affirmative Funding approves on three months of deposits and funds the same day, with repayment that can track revenue.
Using both over time
Many owners use an advance to seize an opportunity now, build repayment history, and later qualify for a bank line. A specialist can tell you which products your statements support today.
Next step
See what your business qualifies for
Businesses with $20,000+ in monthly revenue and six months of history qualify. Three minutes, three bank statements, decision in minutes.