Working Capital Financing: Which Option Fits Your Business

Working Capital Financing

Working capital financing covers the day-to-day costs of running a business: payroll, rent, inventory, and the gap between paying suppliers and getting paid. It is a purpose, not a product. Every product we offer except equipment financing can fill it, and the right one depends on how fast you need the money and how steady your sales are.

Last updated October 14, 2026

At a glance

Line of credit	Best for recurring or unpredictable gaps. Draw, repay, reuse.
Term financing	Best for a one-time need with a known cost. The offer may be a loan or revenue-based financing.
Invoice factoring	Best when slow-paying business customers cause the gap.
Purchase order financing	Best when a large confirmed order needs a supplier paid first.
SBA loan	Best when you can wait months and want the lowest cost.
Business HELOC	Best when you own a home with equity and want bank-level rates in days.

Speed and structure are summarized from our product pages, which cite what Kapitus and the SBA publish. See each page for sources and dates.

Start with the problem

Pick the product by the cause of the gap.

Your situation	Look at first
Customers pay in 30 to 90 days and payroll is weekly	Invoice factoring or a line of credit
Busy season is coming and you need inventory now	Line of credit
A large order came in and you cannot pay the supplier	Purchase order financing
One specific expense with a known price	Term loan
An opportunity that closes this week	Term financing. A fast offer may come as revenue-based financing
No rush, and you want the lowest cost	SBA loan
You own a home with equity and want a low rate fast	Business HELOC
Buying equipment, and the soft costs around it	Equipment financing for the item, plus working capital for the rest. See below

The six options side by side

	Speed	Structure	Published minimums
Line of credit	Days	Revolving limit up to $750,000, up to 24 months	2 years, $180,000 revenue, credit 600 to 680 depending on the lender
Term financing	Days	Lump sum up to $5 million, 6 to 36 months. A loan or revenue-based financing	2 years, $250,000 revenue, credit 600 to 680 depending on the lender
Invoice factoring	About 4 business days	Sale of invoices, $200,000 to $7 million	Creditworthy business customers
Purchase order financing	Days to a few weeks	The financer pays your supplier for a confirmed order, $200,000 to $7 million	A confirmed order with at least a 10% margin
SBA loan	2 weeks to 6 months	Loan up to $5 million, up to 25 years	680 credit published, above 700 in our experience. About 10% down
Business HELOC	Days	Line against your home, up to $750,000, 5 to 30 years	Home equity. Credit 600 behind a mortgage, 640 as a first lien

Working capital alongside equipment financing

Equipment financing pays for the item. It does not pay for what surrounds it: delivery and installation, training, the inventory or staff the equipment needs to earn, and the months before it does. Those are soft costs, and lenders will not roll most of them into an equipment loan.

We can support the business with working capital financing for those costs, or for any other business expense, alongside the equipment financing. Two products, one plan: the equipment on a fixed payment matched to its working life, and the soft costs on a term loan or a line of credit sized to the gap.

Loan or revenue-based financing

A term offer can come back as a loan or as revenue-based financing. Revenue-based financing is not a loan. The funder buys a share of your future sales, and the cost is a factor rate. It is fast, and it usually costs more.

Know which one you are holding before you sign. How the two differ, and how to compare them.

Two rules that save money

Match the term to the need. Finance a 60-day gap with something you can repay in 60 days. Financing short needs with long debt, or long needs with short debt, is where costs pile up.

Compare on total payback and APR. Products quote cost differently: interest rates, factor rates, monthly fees. Convert each offer to the total dollars you will repay and an annual rate. Our guide to factor rate vs APR shows how, and the calculator does the math.

When not to borrow for working capital

If the gap exists because the business is losing money, financing makes it worse. Debt buys time. It only helps if something changes during that time.

How to apply

Fill out our short form. Tell us what the money is for, and we will point you to the product that fits.

Common questions

What is working capital?

The cash you have to run the business day to day. The standard formula is current assets minus current liabilities. In practice it means being able to cover payroll, rent, and suppliers while you wait to get paid.

What is the fastest working capital option?

Term financing and lines of credit. Kapitus publishes decisions in as little as 4 hours and funding in as little as 24 hours on those products. SBA loans take months.

What is the cheapest working capital option?

Usually an SBA loan or a Business HELOC, then a secured line of credit or a term loan. An offer structured as revenue-based financing is usually the most expensive. Speed and cost pull in opposite directions, except on the HELOC, which is both low-cost and fast because your home secures it.

How much working capital financing can I get?

It depends mostly on your revenue and bank balances. Lenders size an offer to what your cash flow can repay. Published program maximums run from $750,000 for a line of credit to $5 million for term financing.

ExtraCredit Loans is a loan marketplace. We act as a broker, not a direct lender. We may be paid by a lender when a financing closes. How we get paid.