Published September 15, 2022

More than 90% of small-business owners are worried about experiencing an economic recession over the next 12 months, according to a June 2022 Goldman Sachs survey.

Because lenders tend to tighten their lending standards during recessions, small-business owners may be looking for ways to secure funds before access to credit is possibly reduced.

One option to consider is to apply for a business line of credit — even if you don’t need it right now. Unlike a business loan, a line of credit lets you decide when to withdraw funds and how much to take out, up to a set limit.

WOULD YOUR BUSINESS BENEFIT FROM A LINE OF CREDIT?

Since it’s common for access to financing to decrease during a recession, getting a line of credit before you need it can be a smart move, especially if you see the potential for cash flow issues in the future.

For example, if you plan to make large investments in inventory and materials or take on projects that require substantial outlays of cash before you receive payment from your customers, a line of credit can help ensure you have funds available in the future to do it.

Read more in the Associated Press: