Two facilities can carry a similar cost yet feel completely different to live with, because the repayment structure shapes your day-to-day cash flow. When comparing options, look at how you repay as closely as how much you repay.
Fixed repayments
A fixed structure means predictable, equal instalments across the agreed term. Budgeting is simple because every payment is the same, which suits businesses with steady, even income. The trade-off is that the schedule does not bend if a quiet month arrives.
Flexible or revolving structures
A flexible facility lets you draw, repay and redraw within an agreed limit, so your outstanding balance and cost move with how much you actually use. This suits businesses with uneven or seasonal income. The discipline it demands is the discipline to repay when funds come in, rather than letting a balance drift.
How to choose
- Map your income over a typical year. Is it even or lumpy?
- If even, fixed instalments keep things simple.
- If seasonal, a facility that flexes can cost less when used carefully.
Credicorp products
Credicorp offers Credicorp Flex and Credicorp Slice. The repayment shape, frequency and term that apply to you are set out in your offer. Read those terms against your own cash-flow pattern before deciding. Credicorp lends only to UK limited companies and LLPs for business purposes.
See also: How to plan Flex repayments around your cash flow, Business credit card vs short-term loan, What is cash flow?.