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How to choose between a short term business loan and a credit card

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Every business owner has had to surpass a number of difficulties when starting, developing or structuring a company, it’s just unavoidable. An important consideration to soothe things out is to have reliable access to funds in order to pay operating expenses, marketing costs or new offices.

There are two great alternatives that will give you access to cash quickly: short term business loans and business credit cards.

Why having access to short-term business loan is important?


A good business opportunity can appear at any moment, and it is important to pursue it rapidly.

A special offer on materials, an urgent request from a business customer or the branching of the company into other ventures will require immediate funding and action. These would be unfortunate moments to go through the hassle of a complicated and long borrowing process. But sometimes the opportunity is worth it.

Let’s look at 3 businesses that have faced this choice

Tomás, the bookstore owner

Let us look at the case of Tomás, who has a bookstore and is considering what other associated products are in demand that he could sell. He finds out about a special offer on school books and backpacks from a supplier and wants to benefit from it.

The downside is that he’s short on cash at the moment, as the business is going slow. He thinks that accepting the offer from the supplier would be advantageous, especially as the school year is about to start, which means the number of customers will increase.

A good way to proceed is a business credit card that will allow paying for supplies and benefiting in the long term. The business credit card will give him adaptability, reliability, and confidence to pursue his business opportunities. Thiago now feels ready to tackle new types of customers.

Mariana, the tailor shop owner

Mariana has a tailor shop and does not have a sufficient number of customers to be sure about the sustainability of her business. Suddenly, she receives a request from a university colleague, he wants her to make the uniforms for a junior basketball team.

She welcomes the opportunity of getting more work, but she also acknowledges the difficulties that it implies: she would have to get a sports clothing specialist and buy new materials for the uniforms.

The solution she found was a short term business loan that will let her honor the request. By doing so, she puts herself in a position that’ll allow her to get new customers that require different and more specialized services. Mariana is now more positive about her business and her capabilities.

Gabriel, the restaurant owner

Gabriel has a restaurant but the location he chose is not the best one for attracting a big customer base and getting recognition. He evaluates the options he has to increase the number of customers.

He decides to start a catering service that will run in parallel to the restaurant. This will allow him to reach out to a broader audience, like shop employees and office workers who have a busy schedule and can’t go to the restaurant but can order for lunch, events, meetings or conferences.

The challenge he is faced with is the additional employees he’ll have to hire; he needs, at least, several employees that will take the orders and several more that will pack the food… and then some more that will then make the deliveries.

His solution was a short term business loan that allowed Gabriel to start offering this new service to customers and to benefit from the increased revenues.

The cases outlined above illustrate that the problems and challenges business owners are confronted with can be overcome with the right financial products and the correct advice.

The right business partner will lend you money with advantageous terms and clear information. They will also ask you about your company and requirements in order to find the best way to help.

If you are a business owner you can find yourself in a situation similar to the ones presented here. You should be informed about the characteristics of short term business loans and credit cards. Choosing the right alternative will help you benefit from business opportunities you wouldn’t be able to take otherwise, and it will also allow you to have constant and reliable growth.

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