In a world where small businesses face financial challenges, access to capital isn't just an advantage — it's a necessity. Corporate credit provides the financial flexibility and security needed to help small businesses grow and adapt to changing market conditions. Whether it's covering unexpected costs or financing expansion plans, corporate credit can play a crucial role in growing your business.
In this article, we'll look at what corporate credit is and how you can apply for it for your business - read on!
You'll learn in 6 minutes or less how corporate credit differs from a business loan, the interest rate on corporate credit and what requirements there are for corporate credit.
What is corporate credit?
Corporate credit is a so-called overdraft or overdraft that offers your small business more financial freedom and flexibility. It's a line of credit issued by a bank or lender where you use the money according to the company's needs.
Corporate credit can be crucial to a small business's finances because it allows for various investments, such as:
- Capital goods
- Expansion projects
- Managing cash flow over different periods
With the help of corporate credit, you can ensure that your company receives capital at the right time to support both growth and daily operations.
Corporate credit vs business loan
Corporate credit looks like a business loan in the sense that your company receives a capital injection, but with one big difference - with business credit, you are awarded an amount and you choose how much of that amount you then use. This is not how a business loan works, where you, as a borrower, are obliged to repay the full amount borrowed, plus interest on top of that amount. With business credit, you only pay back the money you used, not the full amount granted.
Corporate credit for starting companies
For a small business startup, corporate credit can be indispensable - because new companies may not always have an established credit rating or long business history, it can sometimes be more difficult to qualify for traditional business loans. This can make corporate credit a valuable and more flexible source during the early and unpredictable days of entrepreneurship.
Interest on corporate credit: what about that?
With corporate credit at traditional banks and lenders, you only pay interest on the money you use, in contrast to a business loan where interest is paid on the full amount borrowed.
At Qred, we do things a little differently - instead of interest, you pay a fixed amount per month for your business credit. So we have no interest or other costs, you pay the same fixed amount every month. Corporate loans with us have no maturity, and you only pay for the months that you have the credit.
How to apply for corporate credit from Qred
Corporate credit online with Qred is fast, secure and easy. Applying for corporate credit is a smooth process that can be summarized in three simple steps:
1. Request in one minute: Quick and easy application process. The request is free and non-binding, and we will not do a BKR check on you as a private person.
2. Get an answer within one hour: After you apply, we'll contact you within an hour - you'll get a decision on how much credit space your company gets.
3. Same-day payout: Sign with iDIN and get the money the same day.
Common business credit requirements
When applying for business credit as a small business owner, it is important to be aware of some of the basic requirements that lenders often set. These requirements may vary slightly, but here are the most common among traditional lenders:
- Registered company: The company must be officially registered and have a valid Chamber of Commerce number.
- VAT number: The company must be registered for VAT.
- Operating time: Many lenders require that the company has been in business for a minimum of six months to one year.
- Financial health: The company must have a stable financial history without debts with the tax authorities. The creditworthiness is usually assessed by a credit check.
- Revenue requirement: Some lenders may set requirements for the company's annual turnover, which often has to exceed a certain limit.
It is also common for the owner or director of the company to act as a guarantor, which means that he or she is personally financially responsible if the company is unable to repay the credit.
These requirements are intended to ensure that the company is considered able to manage and repay the credit, which reduces the risk for the lender.
Small businesses with Qred
Corporate credit can help your small business run more smoothly by increasing financial flexibility - at Qred, we understand these unique needs of small entrepreneurs. That's why we offer tailor-made financing solutions that are fast, flexible and without complicated terms. Our goal is to make finance simple and accessible, so you can focus on what matters most — running and developing your business.
Whether you need help selling invoices, getting a business card, or want to learn more about entrepreneurship with our articles, we're here to contribute to your journey. Get started with Qred today, and good luck with your business!
Corporate Credit FAQs
What is corporate credit?
A corporate loan is a type of financing that gives companies access to a predetermined amount of capital, which can be used as needed. It is a flexible solution for managing cash flows or financing investments.
What are the requirements for an overdraft?
To get an overdraft, the company usually has to meet certain criteria, such as a stable financial history, operating time, and often a check of the company's creditworthiness. There may also be requirements for minimum turnover and that the company has no debts with the tax authorities.
How much does an overdraft cost?
The cost of a business loan depends on the lender. With Qred, you only pay a fixed monthly amount for the business loan, while other lenders can sometimes charge interest on the amount used as well as any administrative costs.
