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Revolving credit facility
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Cash flow challenge: I need flexible access to funds to manage short-term working capital needs.
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Perfect for: Businesses looking for an ongoing, reusable line of credit to manage day-to-day cash flow or seize opportunities.
A revolving credit facility gives businesses flexible access to funds for everyday operational needs, without committing to long-term debt or disrupting cash flow.
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Rates from 0.5%
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Pages in this SectionWhat is a revolving credit facility?
A revolving credit facility (RCF) is a flexible business funding solution that allows a company to draw down funds up to an agreed limit, repay them, and draw again as needed. Interest is only charged on the amount used rather than the full facility limit, making it an efficient way to manage working capital.
Unlike a traditional term loan, where you receive a lump sum and repay it over a fixed schedule, a revolving credit facility gives ongoing access to capital within an agreed limit for a set period, typically between 1 and 5 years.
It is commonly used by UK businesses to manage short-term cash flow fluctuations, cover operational costs, and maintain liquidity during periods of uneven income.
How a revolving credit facility works
A revolving credit facility is structured around a pre-approved credit limit.
For example, if your business secures a £250,000 facility:
- You may initially draw £80,000
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Interest is charged only on the £80,000
- You repay £30,000
- Your available balance increases to £200,000
- You can draw again without reapplying
This cycle continues throughout the agreed term of the facility. The key benefit is flexibility, you only borrow what you need, when you need it.
Benefits of a revolving credit facility
- Flexible access to capital
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Interest charged only on utilised funds
- Supports seasonal or irregular cash flow
- Reusable funding without reapplication
- Improves liquidity management
- Can complement existing term loans or asset finance
Revolving credit facility vs a traditional loan
RCF:
- Flexible drawdown
- Interest charged only on funds used
- Reusable capital
- Designed for ongoing working capital
- Often shorter to medium term
Traditional loan:
- Lump sum paid upfront
- Interest charged on full amount
- Fixed repayment schedule
- Suitable for defined projects or investments
- Typically fixed duration
If your business needs structured funding for equipment or expansion, a term loan may be appropriate. If you require ongoing liquidity support, a revolving credit facility may be more suitable.
How it works with Novuna Business Cash Flow
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Tell us about your project and funding requirements
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We compare specialist lenders to find you a great deal
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You apply with full support from our experts
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Access funding as and when you need it, repay and reuse on demand
Fast decisions. Flexible options. Funding over £2bn to more than 1,000 SMEs every year.
Is a revolving credit facility right for you?
You need flexible funding to cover operational costs
A revolving credit facility lets you draw funds as needed and repay on your own schedule.
You want to smooth out seasonal or irregular cash flow
Ideal for businesses with fluctuating income, helping balance peaks and troughs.
You’d prefer not to reapply for finance every time you need it
Once approved, you can access funds repeatedly without going through new applications.
If that sounds like your business, we’ll help you compare providers and secure the right deal.
Novuna can support businesses with a range of funding challenges
What is your challenge?
I want to pay suppliers early without harming cash flow
I’ve won a large order but need help with materials
I need flexible credit terms with my suppliers
I want funding to stock up before peak demand
How we help
How Novuna helps businesses access funding fast
Tell us what you need
Start with a simple form or call - tell us your business challenge.
We compare your options
We compare multiple providers to get you a great deal.
Choose the right type of funding
Access a range of short-term funding options including loans, advances, and invoice finance.
Apply with expert support
Get help applying - with a real expert on hand throughout.
Get clear, transparent terms
No jargon, no surprises - just honest advice with no hidden fees.
Receive funding fast
Get access to finance quickly so you can focus on your business.
Why take action now
Bridge short-term gaps without locking into long-term debt
Access funds instantly when challenges or opportunities arise
Act before seasonal peaks, supplier payments, or new investments hit your cash reserves
Why choose Novuna Business Cash Flow?
Why businesses trust us for debt factoring
We're highly rated by our existing customers
"The communication and support has been outstanding. Providing me with all the information I needed regarding new clients coming onto our books. The system they use is so user friendly and the drawdown payments are very efficient in the fast moving world of temporary payroll.'
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What revolving credit facility looks like in your sector
Get advice tailored to the challenges in your industry
How is a revolving credit facility different from a traditional loan?
Unlike a fixed term loan, a revolving credit facility lets you draw funds, repay, and borrow again within an agreed limit which gives you ongoing flexibility without reapplying.
Does using a revolving credit facility affect my business credit rating?
Yes, positively if managed well. Making timely repayments can strengthen your credit profile, but missed payments could have the opposite effect.
What is the difference between a RCF and an overdraft facility?
A revolving credit facility is a structured funding agreement with an agreed limit over a set term, allowing businesses to draw, repay and redraw funds as needed, often with greater certainty and scalability. An overdraft facility is typically linked to a bank account, may be reviewed annually, and is generally designed for short-term cash shortfalls rather than structured working capital planning.
Is revolving credit facility suitable for small businesses?
Absolutely. Revolving credit facilities are widely used by SMEs to manage day-to-day cash flow, cover short-term expenses, or take advantage of growth opportunities.
How quickly can I access funds?
Once the facility is approved, funds can usually be drawn down instantly, giving you fast access to working capital whenever you need it.
