3 reasons to grow your business with overdraft replacement

Published on 26th February 2019

As a developing SME owner, your ability to stimulate and fund growth may be limited and, during certain trading periods, your income could become constrained. This could make living up to financial obligations and growth aspirations a daunting prospect, prompting you to seek financial assistance. Although your initial instinct might be to establish an Overdraft Facility which will work in conjunction with your existing banking arrangements, such facilities have become harder to obtain. This is why more and more SME owners are using Overdraft Replacement. A short-term form of business finance, Overdraft Replacement offers your business a Line of Credit that can be used to support any aspect of your business, including growth. So if you’re hoping to make a start on a long-awaited growth project or need help seeing an existing one through to the end, here’s why you should consider applying for an Overdraft Replacement.

  • Cash when you need it
  • No usage restrictions
  • Manageable repayment process

How much money could my business borrow through Overdraft Replacement?

Overdraft Replacement, also known as Alternative Overdraft or Revolving Credit, presents your business with a Line of Credit from which you can withdraw an allowance. The size of this allowance is usually determined by your business’ past income and can be drawn upon instantly as soon as an agreement has been reached. Although you’re under no obligation to use any of this allowance, the amount that you do choose to withdraw is entirely up to you. However, it’s worth noting that if you withdraw more than the credit limit imposed, you’ll incur an overdraft penalty as a result. Therefore, Overdraft Replacement provides you with the means to access external funds whenever the need arises.

Need help supporting your growth aspirations? Looking to smooth out your business’ cash flow? Apply for an Overdraft Replacement or learn more about how your business could benefit!

How can I grow my business with Overdraft Replacement?

Because Overdraft Replacement facilities have no usage restrictions dictating how the allowance can be used, the ways in which the agreement can be used to your business’ benefit are numerous. So if you’re looking to grow your business using Overdraft Replacement, some of the ways it can help include purchasing equipment, obtaining machinery, expanding your fleet, building extensions or carrying out refurbishments. In addition, Overdraft Replacement can also be used to smooth out uneven cash flow during slow trading periods by covering your operating costs and any other relevant expenses. As such, an Overdraft Replacement can help your business pay staff and contractors, bring in fresh stock, acquire additional supplies, settle utility bills, resolve Accelerated Payment Notices, building constructions to unexpected emergencies. Therefore, applying for an Overdraft Replacement can help reinforce the foundations of your business’ finances, offering you the confidence to go and pursue your growth aspirations.

How affordable is an Overdraft Replacement facility?

Overdraft Replacements offer you a flexible means of borrowing and repaying money for business and stimulating growth. Like a credit card, you only repay and are charged interest on the money that you have borrowed. If you have chosen to withdraw any of the funds that were made available to your business, you can either repay it instantly or anywhere within 30 - 90 days. For many SMEs, this is often perceived as a convenient and affordable repayment method which allows you to defer the debt, giving you ample opportunity to amass the necessary funds.

Thinking about applying for Overdraft Replacement?

Making sure that your business has the ability to grow and remain sustainable isn’t easy. It takes dedication, planning, many hours of hard work and sufficient funding. But if you were to hit a slow trading period, the issues this could cause for your finances and working capital may force you to postpone or even cancel any plans that you might have had for growing your business. However, cashflow needn’t be a problem for your business, not with Overdraft Replacement at hand. Overdraft Replacement provides you with a Line of Credit that enables you to shore up business’ finances, putting you in a much stronger position to go and support any growth project you want to start or complete. So if you’re looking to purchase equipment, pay staff wage or support each stage of an essential construction project, apply for Overdraft Replacement today or find out more with Rangewell.

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David Harrison

David Harrison

Content writer
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