How Business Loans for SMEs Are Powering India’s Economic Growth
June 13, 2025
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Running a business often means navigating unexpected expenses, seizing growth opportunities, or managing cash flow gaps. But how do you choose the right financing option? Should you opt for a traditional business loan or a flexible credit line? Both options offer unique benefits, but they cater to different needs. A line of credit for business provides ongoing access to funds, while a traditional loan gives a lump sum for specific purposes. Understanding their differences can help you make an informed decision. In this blog, we’ll compare business loan vs credit line, explore when a flexible credit line is the better choice, and show how Everlight Holdings Pvt Ltd can support your business with tailored solutions.
A flexible credit line is a revolving loan that allows businesses to borrow funds up to a pre-approved limit, repay them, and borrow again as needed. Unlike a traditional loan, which provides a one-time lump sum, a line of credit for business offers ongoing access to capital, making it ideal for managing cash flow or handling unexpected expenses. You only pay interest on the amount you use, not the entire credit limit, which can save you money over time. For example, if your business has a credit line of ₹10 lakh and you use ₹2 lakh, you’ll only pay interest on the ₹2 lakh. This flexibility makes it a popular choice for SMEs needing adaptable financing. At Everlight Holdings, our flexible credit line is designed to support both short-term needs and long-term growth, ensuring you have funds when you need them most.
Choosing between a traditional business loan and a flexible credit line depends on your business needs. Let’s compare business loan vs credit line to help you decide:
| Aspect | Flexible Credit Line | Traditional Business Loan |
|---|---|---|
| Fund Access | Revolving access—borrow, repay, and borrow again up to a limit. | One-time lump sum disbursed at the start of the loan term. |
| Interest Calculation | Pay interest only on the amount used, not the entire limit. | Pay interest on the full loan amount from the start. |
| Repayment Structure | Flexible repayments; pay as you use, with minimum payments on outstanding balance. | Fixed monthly EMIs over a set term, regardless of usage. |
| Purpose | Ideal for ongoing needs like cash flow or unexpected expenses. | Best for specific, one-time investments like equipment purchase. |
| Approval Process | Often faster, with digital-first NBFCs offering quick approvals. | May take longer due to stricter eligibility and documentation. |
| Flexibility | High flexibility—use funds as needed without reapplying. | Less flexible—requires a new application for additional funds. |
Understanding these differences can help you decide which option aligns with your business goals, whether it’s the adaptability of a credit line or the stability of a loan.
A line of credit for business is a powerful tool for many scenarios, offering flexibility that traditional loans can’t match. Here’s when you should consider a flexible credit line:
These scenarios highlight why a flexible credit line is often the better choice for dynamic business needs.
At Everlight Holdings Pvt Ltd, we offer a flexible credit line designed to empower businesses with quick, accessible financing. As an NBFC with digital financial solutions, our credit line features include fast online approvals, minimal paperwork, and competitive interest rates tailored to your needs. You can access funds anytime up to your approved limit, paying interest only on what you use. Our Kolkata-based team of 25+ professionals provides personalized support to ensure your financing aligns with your goals. Contact us at everlightnbfc@gmail.com or +91 99714 16789 to learn how our line of credit for business can support your growth.
Need financing that fits your business? Explore Everlight Holdings’ flexible credit line today!