One of the most common and frustrating cashflow patterns for a trading business is having an order book full of profitable work while the current account shows very little cash. This almost always comes down to a mismatch in payment timing: you pay suppliers and staff promptly, but your customers pay you on 30, 60, or even 90-day terms. Short-term finance is specifically designed for this gap.
The timing mismatch explained
Suppose you complete a project in week one, invoice immediately, and your customer pays in week nine on standard 60-day terms. Meanwhile your supplier wants payment in week three and payroll runs in week four. The profit exists on paper but the cash has not arrived yet. This is a timing problem, not a profitability problem — and short-term finance is the right tool for a timing problem.
Matching the product to the gap
A revolving facility such as Credicorp Flex works well here: you draw at the point of need (week three, say), repay when the customer pays (week nine), and the facility resets for the next cycle. Because you only carry the balance for the weeks you actually need it, the cost reflects the genuine duration of the gap rather than a longer fixed term. For a single large invoice rather than a recurring pattern, Credicorp Slice — which spreads one bill over three or four weekly instalments at a flat 6% fee — may suit the occasion better.
Managing debtor terms actively
Short-term finance is most efficient when used as a bridge, not a permanent substitute for collecting cash. Alongside borrowing, it is worth reviewing whether your invoice terms are as tight as your market will accept, whether you offer early-payment incentives on large invoices, and whether your credit control process chases promptly from day one of an overdue balance. Every day you shorten your average debtor period is a day less you need to borrow.
We lend only to UK limited companies and LLPs, and the loan is to the company with no director personal guarantee. As business finance outside the consumer-credit regime, it is not covered by the Financial Ombudsman Service or FSCS.
See also: How to make the most of a revolving credit facility, Warning signs your business may be overtrading.