A revolving credit facility is one of the most flexible small business funding options in South Africa for good reason. As a small business owner, you can draw capital whenever you need to cover expenses or buy extra stock, then draw it down again after you’ve paid it back – without needing to reapply (depending on approval criteria).
Yet for all its advantages, a revolving facility can look very different depending on where you get it from. Banks and fintech lenders each come with their own criteria, including approval time, collateral demands and fee structure. What works for one business may not work for another.
Read on to find the top five revolving facilities working for businesses in South Africa right now, and how they might be an excellent fit for your enterprise.
1. Lula Cash Flow Facility
Lula’s Cash Flow Facility flips traditional lending around. Instead of relying solely on credit history and financial statements, Lula also considers how your business is actually performing in real time.
This begins with the application process. Upload your bank statements directly on their platform, or link your bank account to share read-only transaction data instantly. Either way, Lula can assess your trading performance in minutes, without you leaving your office.
Approval can take as little as 24 hours, then you get access to a cash flow facility that operates as a line of credit, with no monthly fees and no fixed repayments. Instead, you simply pay for what you draw down.
Lula acts more like a business partner than a lender, which is why they provide round-the-clock customer service and the option to increase your facility limit as your business grows.
To qualify, you just need R500 000 in annual turnover, one consecutive year of trading history as a South African-registered business and a healthy credit score, with no need for collateral. Lula also offers other types of funding for small businesses, including fixed-term loans.
Best Suited For
SMEs that need fast, flexible working capital and don’t want to tie up their business assets as security.
2. Bridgement
Bridgement offers a pre-approved business line of credit that works on a similar principle to a revolving facility.
Like Lula, it uses bank statement data to assess your business’s situation instead of demanding security, and charges no fees when the facility is unused.
Decisions are made faster than through traditional bank channels, and the product is designed specifically for South African SMEs.
Best Suited For
Established businesses with variable cash flow that need a source of standby capital ready for lean periods.
3. FNB Business Revolving Loan
FNB’s business revolving loan is a credit facility that replenishes as you repay. To qualify, you need to provide two or more years of trading history and financial statements, as well as hold a business account with FNB.
Because the application process is document-heavy, approval can take a week or two, and FNB may ask you for security depending on your business’s situation.
Best Suited For
Established FNB business clients that boast a clean credit record, the right documentation and no urgency to receive funds quickly.
4. Absa Business Revolving Facility
Absa is a popular bank that includes a revolving credit facility of up to R350,000 among its funding options.
Typically, you’ll need to provide audited or reviewed financial statements, your business’s credit profile and existing banking history. The facility has an indefinite term (reviewed annually), but you do need to make a minimum monthly payment on withdrawn funds.
To apply, you’ll need to either go to an Absa branch or ask for a representative to call you back, and approvals follow the standard lending timeline.
Best Suited For
Businesses with an established Absa relationship and a track record that meets bank lending criteria.
5. Standard Bank Business Revolving Credit Plan
Standard Bank’s business revolving credit plan offers access to a pre-approved credit pool that they can draw from and replenish. Repayments are fixed, and you can redraw once you’ve paid back at least 15% of the original loan amount.
The facility is open to Standard customers only, so if you don’t have an account with them, you must open one to apply. Once open, fees include a one-off initiation payment and a monthly fee to keep the account open.
Best Suited For
Existing Standard Bank business clients who meet the bank’s lending criteria and have the time to follow a conventional application process.
Fintech Alternatives
Traditional revolving credit facilities can work well, but businesses often need to jump through various hoops, including solid financials and security to offer.
For the many South African SMEs that fall outside those parameters, or simply cannot afford to wait weeks for an approval, there are now several fintech alternatives built to serve them. Lula’s Cash Flow Facility stands out among these thanks to its speed, its lack of collateral requirements and its flexibility: a facility that grows with your business and costs nothing when you are not using it.
A revolving credit facility is one of the most flexible small business funding options in South Africa for good reason. As a small business owner,… Read More
