Keeping an adequate cash flow on a consistent basis is unfortunately one of the biggest challenges for many small businesses today. In fact, part of the reason many young businesses don’t succeed is because it’s often difficult to maintain the working capital you need to fund essential operations. At the same time, though, it’s tricky to predict when you’ll need more cash, making large bank loans a less-than-ideal option for many scenarios. For cases like these, business lines of credit can provide a welcome alternative, and can even have some unexpected advantages.

The Spending Purpose Is Entirely Up to You

If you’re familiar with conventional loan applications, you know that most banks ask you to state the purpose you’ll be spending the loan on right from the beginning. However, many business owners run into unforeseen expenses or situations that can be difficult to predict months or years in advance. With a credit line, you don’t have to state a specific usage purpose on your application. Instead, you’re largely free to spend the money as you see fit, when you see fit.

It Multitasks by Helping Build Your Business Credit Over Time

Even if you don’t need or want a loan right now, it’s possible you might in the future. Having as high of a business credit score as possible is essential to securing coveted loans, so you should start trying to build up your score now. By using your credit line responsibly and making on-time payments, you can demonstrate your creditworthiness.

Revolving Credit Puts You in Control of Using Funds

While bank loans typically provide a large sum of money up front, the fact that you’re only given a certain amount can actually work against you in some cases. For instance, you’ll usually be required to begin paying it back right away, even if you haven’t started tapping into the funds. A business credit line, by contrast, puts you firmly in control by letting you choose when you use your available funds. This is commonly referred to as revolving credit, and can be a very empowering aspect of having a credit line as your safety net.

Cash flow is one of the most common grips of new business owners, and often plays a part in determining a company’s long-term success. If you find it tough to keep enough capital in the bank when times are tough but applying for a substantial loan isn’t the best fit either, consider looking into business lines of credit as a workable alternative. This option comes with several unexpected benefits and could potentially help get your business back on its feet.