Some businesses do not earn steadily. Project-based firms, agencies, contractors and milestone-billed companies often see income arrive in large, irregular lumps with long quiet stretches in between. The work is profitable overall, but the cash arrives in a rhythm that does not match the steady drumbeat of wages and overheads.
The problem with lumpy income
Fixed costs are smooth; your income is not. In a strong month everything feels fine, but during the gaps between big payments you can be cash-poor even though your order book is full. Planning becomes guesswork, and a single delayed payment can tip a comfortable month into a stressful one.
How a facility helps
- Covers steady running costs during the gaps between large receipts.
- Reduces the temptation to take poor work just to bring cash forward.
- Lets you plan around your true profitability rather than this month's bank balance.
Repay as the lumps land
The natural way to use smoothing finance is to repay when your large payments come in, then draw on it again as needed across the cycle. You repay over your agreed term at the rate shown in your offer. Keep an eye on the trend; smoothing should reduce stress, not become a permanent overdraft substitute.
Credicorp lends only to UK limited companies and LLPs for business purposes, never to individuals or sole traders, and we take no personal guarantees. As an exempt lender we sit outside the FCA consumer-credit regime, so the Financial Ombudsman Service and FSCS do not apply.
See also: Can finance help my company take on a large new order?, How seasonal businesses can use Slice, Funding the costs of delivering a large customer order.