2 min read
How a facility differs from a loan
A term loan gives you a fixed amount on day one, which you repay over a set period. A facility works more like a reusable limit: the money sits available, and you draw on it only when there is a reason to. When you repay, that headroom comes back. For a fuller comparison, see working capital finance and the revolving credit definition.
When Flex tends to fit
Flex suits a company whose cash needs move around — covering a payroll run before a big invoice lands, buying stock ahead of a busy season, or smoothing the gap between paying suppliers and being paid. If you have a single, known cost instead, a fixed-term loan is often simpler. You can model the difference with the working capital calculator.
What it costs
Because Flex is a facility, the charge applies to the balance you have actually drawn, not the whole limit. Leave it untouched and the running cost is low; draw heavily and you pay for that use. Credicorp lends to the company, not to you personally, and does not take a personal guarantee. Full product detail is on the Credicorp Flex page.
Frequently asked questions
Is Flex the same as an overdraft?
It is similar in spirit — a reusable limit you dip into — but it is a dedicated commercial facility for limited companies rather than a bank current-account overdraft. See the difference between an overdraft and a business loan for more.
Do I pay for the whole limit even if I don't use it?
No. The cost falls on the balance you have drawn. An unused limit sits available without the same running cost as a fully drawn loan.
Can I switch between Flex and a term loan?
They suit different needs, and the right choice depends on whether your cash requirement is one-off or recurring. Many companies use a term loan for a known purchase and a facility for everyday smoothing.
Related reading
What is the difference between a loan and a credit facility?
A loan is a single fixed sum advanced up front and repaid over a set schedule, while a credit facility is a…
Read →
What is working capital finance?
Working capital finance is short-term funding that covers a company's everyday running costs — stock, wages,…
Read →Revolving credit facilities for business
A revolving credit facility gives your company a pre-agreed limit you can draw, repay and redraw as cash flow…
Read on Learn →
Working capital calculator
Measure the cash cushion between what your business owns short-term and what it owes short-term — and see if…
Read on Tools →Funding for UK limited companies
Credicorp lends to your company, not to you personally — short-term working capital with no personal guarantee. See what your business could access.