Managing day-to-day expenses is a constant balancing act for business owners. When cash gets tight—whether due to late invoices, seasonal slowdowns, or expansion plans—you need access to short-term funds. But should you go with a working capital loan or a business overdraft? 

At Capital Plus Finance, we break down the pros and cons so you can choose the right funding fit for your needs. 

What is a Working Capital Loan? 

A working capital loan is a short-term loan designed to cover operational expenses like wages, rent, supplier payments, or inventory. It’s typically unsecured and repaid over 3–24 months with fixed regular payments. 

Best for: 
✔ Predictable costs 
✔ Short-term needs 
✔ Newer businesses with limited credit history 

What is a Business Overdraft? 

An overdraft is a credit facility linked to your business transaction account. You can draw funds up to an agreed limit as needed and only pay interest on what you use. 

Best for: 
✔ Ongoing, fluctuating cash flow needs 
✔ Businesses with seasonal sales cycles 
✔ Long-standing businesses with stable income 

Key Differences 

When to Choose Which 

• Choose a working capital loan if you need funds fast and prefer structured repayments. 

• Choose an overdraft if you want ongoing access to funds you can dip into as needed. 

Bonus tip: You can have both. Many successful businesses use a mix to manage predictable costs and unpredictable swings. 

Final Thought 

Choosing the right cash flow solution can mean the difference between surviving and scaling. Whether it’s a one-off loan or ongoing access to credit, we’ll help you match the right facility to your growth strategy. 

Upgrade Now, Pay Smarter—Flexible Equipment Finance for Aussie Businesses 
We help businesses like yours replace ageing assets, scale up, and stay ahead—without the upfront burden.  

👉 Book a meeting  with the Capital Plus Finance team today and let’s find the right solution for you.