Business lines of credit

Part of Business Financing

A business line of credit provides reusable borrowing capacity within an approved limit. It can suit recurring short-term cash-flow gaps, while a long-lived asset purchase may fit a term loan better. Compare ordinary operating lines with government-program credit lines rather than assuming they have identical fees, limits and renewal conditions.

Compare the 3 listed products below. Open a product for its terms and source links. Missing terms are not confirmed.

TD Canada Trust

Canada Small Business Financing Line of Credit

Working-capital credit through the Canada Small Business Financing program. Interest and registration charges apply, and program participation does not guarantee approval.

Maximum credit: Up to CAD 150,000, subject to program rules and credit approval.
Registration fee: 2%, paid upfront or financed within the authorized limit.
Uses: Working capital and operating expenses.
Initial term: Up to five years; renewal and conversion options subject to conditions.

Full details for Canada Small Business Financing Line of Credit (opens in new tab)

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Scotiabank

Credit Line for Business

Reusable operating credit for cash-flow gaps and working capital, with floating interest linked to prime.

Uses: Operating expenses and working capital.
Interest: Floating rate linked to prime; applicant-specific spread Not confirmed.
Structure: Revolving credit within an approved limit.

Full details for Credit Line for Business (opens in new tab)

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RBC Royal Bank

RBC Business Line of Credit

A revolving credit line for business cash flow from RBC.

Full details for RBC Business Line of Credit (opens in new tab)

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Costs to compare

Ask for the interest formula, applicant-specific spread, setup and annual fees. Scotiabank describes a floating rate linked to prime. TD's Canada Small Business Financing line also has a registration fee.

Risks and restrictions

Test affordability if rates rise. Review security, personal guarantees, reporting duties and renewal conditions. An operating line is not a permanent solution for losses with no realistic repayment plan.

Common questions

Can I reuse repaid credit?

Revolving credit generally restores available borrowing capacity as principal is repaid, within the approved limit and agreement.

Does a government program remove borrowing costs?

No. Interest and program charges may apply. Compare the lender's complete disclosure rather than treating program participation as free funding.

Sources for this guidance

What to check before choosing business lines of credit

Cost of funding

Compare interest, origination charges, repayment deductions and the total cost.

Cash flow fit

Check repayment timing against your business income and seasonal changes.

Personal exposure

Ask about collateral, personal guarantees and what happens if payments are missed.

Do not treat a factor rate as an annual interest rate. Ask the provider to explain the repayment calculation.

Before you visit a provider

Confirm current fees, rates and eligibility directly with the provider. Product terms can change over time. A listed product is not a recommendation or a promise of approval.

Availability must be confirmed for your province or territory. If product-specific location or eligibility information is missing, it is not confirmed.

For further guidance, visit Financial Consumer Agency of Canada.

This is general information, not personalized advice. Read our editorial policy and affiliate disclosure.