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How can I find flexible financing for my business?

Business, like life, can be unpredictable. You never know when you might need extra cash to fund a new opportunity or an unbudgeted expense.

That’s why it’s smart to explore your financing options before you need it. With a little planning, you can have a flexible source of funds in place that you can tap as necessary. You will discover alternatives for virtually every financial need.

A business credit card – Your company may already use a business credit card for everyday expenses. A card is a great, flexible way to access financing instantly. It can also be a great tool if you’re seeking to establish business credit.

Depending on how you use your card, you should be able to find one that aligns with your specific business needs. If you tend to carry revolving balance, for example, you might look for a business credit card with a low APR (annual percentage rate) and an extended grace period. If you typically avoid interest by paying your full balance each month, you may prefer a card that earns rewards or provides cash back on regular business spending.

Commerce Bank offers multiple business credit card options, including cards that make it easy to track business purchases, place limits on employee spending, and streamline your payment process.

A line of credit – A growing business needs to purchase inventory, pay operating expenses and fund expansion needs. A line of credit is a flexible, reusable solution that can be used for these ordinary expenses, as well as other financial challenges that come with running a business.

A line of credit gives you access to a specific amount of money that you can draw from and repay repeatedly on an as-needed basis. Because you only pay interest on the amount you use, a line of credit can be a great way to finance short-term operating expenses or seasonal operations. It can also provide peace of mind when you don’t know exactly how much money your business will need for a project or if you simply want a reliable source of working capital available.

Depending on the terms you agree to with your lender, your line of credit may automatically renew each year, or it may end when the draw period expires. Approval criteria, interest rates and fees can vary from one lender to the next. Interest rates on a credit line are typically lower than you will find on a business credit card.

Term loans –These “lump sum” loans provide you with money up front which you then pay back at fixed intervals. Term loans are attractive to many businesses because they can be repaid over a long period of time and typically have lower interest rates than other options. A good credit history can help you qualify for more affordable rates.

Because term loans provide a quick influx of capital, they are often the most flexible way to finance major expenditures. Commerce Bank works with borrowers to design a loan repayment schedule to match their cash flow. The convenience and flexibility these loans offer can be especially helpful when acquiring critical assets or funding expansions, investments that may not deliver overnight returns. A term loan enables you to put your plan into motion on your terms and at your pace.

Equipment Financing - If you need to upgrade your equipment, automate your manufacturing processes or improve your data security against cyberattacks, equipment financing may provide the flexibility you are looking for. An equipment loan can be structured as a term loan, a line of credit or a combination of the two. Not only does the loan offer flexibility in how you use it, the repayment plans can be more flexible than those of traditional term loans.

The terms for equipment loans can also be designed to help you improve cash flow, as well as to maximize return on assets and tax benefits. They also allow you to conserve your credit lines for other short-term purposes.

Look for financing options that align with your particular circumstances. For example, Commerce Bank offers finance leases that enable a business to claim depreciation and interest deductions. Or you may prefer an operating lease, where you pay reduced rental cost in exchange for the bank retaining the tax benefits of equipment ownership. Synthetic leases are among the many other options that are available. These hybrid leases are structured so that your company owns the equipment while giving you an option to return it after a specified period.

The Bottom Line: Small businesses need financing flexibility to address the ups and downs that are part of every company’s business cycle. By identifying your options and planning ahead, you can be prepared when opportunities arise or the unexpected happens.

At Commerce Bank, we look at challenges as opportunities to innovate and at disruption as a chance to uncover new ways to add value. We value long-term relationships and are ready to take on challenges and opportunities together and strive to know your business and offer creative solutions to the challenges you face every day. Learn more at

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