Working capital loans to keep the business moving

The working capital squeeze

Every business has a gap between paying out and getting paid. A wholesaler buys stock months before it sells. A builder pays subcontractors weekly but waits on progress claims. A manufacturer pays for raw materials, wages and power before a single product ships. When sales grow, the gap grows with them, which is why fast-growing businesses are often the ones that run short.

Working capital funding fills that gap so the business can keep trading at the pace the work allows.

Size the gap before you borrow

Ask for too little and you will be back next month; ask for too much and you pay for cash that does nothing. The cash flow gap calculator lets you enter six months of money in and money out and shows the lowest point your balance reaches. That low point, plus a buffer, is usually the right amount to fund.

Matching the product to the gap

Shape of your gap	Product that usually fits
One deep dip, then recovery	Short-term working capital loan
Gaps that open and close every month	Business line of credit
Cash tied up in unpaid invoices	Invoice finance
Stock purchases ahead of sales	Trade finance
Large need, complicated credit	Property-secured loan

What lenders want to see

For unsecured working capital, lenders read the business bank account: average deposits, how close the balance runs to zero, regular costs and existing loan repayments. They want to see that the gap is about timing. If the account shows consistent losses month after month, borrowing will not fix the underlying problem, and a good lender will say so.

For secured working capital, the property and the plan to repay carry more of the decision. That makes it possible to fund businesses with tax debt, defaults or very short trading history, from $20k up to $5m, without a valuation before approval.

Practical ways to shrink the gap

Funding is not the only lever. Tightening payment terms, invoicing on time, chasing overdue accounts and negotiating longer supplier terms can all reduce how much you need to borrow. Large businesses are required to report how quickly they pay small suppliers, which gives you useful information when negotiating. Our guide to the cash flow gap covers the practical steps.

An illustrative example

A joinery workshop wins a large fit-out contract for a new office building. The builder pays progress claims after each stage is certified, which takes several weeks. Timber, hardware and wages for the first stage are due well before the first claim is paid.

A short-term working capital loan, sized to the deepest point of the gap shown in a simple cash flow plan, funds the first stage. As progress payments arrive, the loan is repaid. The workshop takes on the job without stretching its suppliers or delaying wages, and it has a clear record of the cycle for next time.

Warning signs to take seriously

If the account shows losses month after month, or you are using new funding to pay old funding, the problem is not working capital. Look at margins, pricing and costs with your accountant before borrowing more.

Ask about working capital

Use the 60-second form and tell us the size of the gap and what causes it. No credit check is run for enquiries, and a real person will suggest the product that matches the shape of your cash flow. Your details stay with one team. Get working capital sorted.