Working Capital Loans: In Practice  

Working capital is effectively the cog that keeps everything in your business turning. Without enough working capital, you’ll struggle to cover your costs and continue running. In times of tight cash flow or when an exciting opportunity presents itself, a working capital loan can be an invaluable tool for maintaining sufficient liquidity.  

 

However, business finance can feel overwhelming. With so many options available on the market, it can be difficult to decide which one is best. At White Oak UK, we strive to provide our clients with complete flexibility, working with them to create a bespoke business finance product that suits their needs, goals and timeframe.  

 

While we’ve previously explored what working capital loans are and how they work, we also thought business owners of all sizes would find it useful to see exactly how they work in practice. Below, we’re taking a look at the practical points of working capital loans, like eligibility requirements, what you can use them for and some real-world scenarios where our clients have benefited from taking out a working capital loan with White Oak UK.  

What is Working Capital? 

Working capital, also known as net working capital, refers to the funds your company needs to manage its day-to-day operations. It is essentially the cash available after subtracting your business’s short-term liabilities from its short-term assets.

In simpler terms, working capital is the money remaining after accounting for all incoming revenue and outgoing expenses over a specific period. Sufficient working capital is vital for maintaining smooth business operations, ensuring you can cover expenses such as payroll, inventory, and other short-term obligations.

What is a Working Capital Loan? 

Working capital loans are short-term loans that help businesses cover daily operating expenses. With this funding, they can address cash flow shortages or fund growth opportunities. A flexible, far-reaching form of business finance, working capital loans come in a variety of different shapes and sizes. Some popular types of working capital loans include business credit cards, invoice financing and asset-based lending.  

Is My Business Eligible for a Working Capital Loan? 

We work with a range of business sizes, offering working capital loans for both well-established and younger companies. We usually ask that clients have:

• Been trading for 3 years or longer
• A track record of profitability
• Need the cash as a short-term requirement

 

However, you can now Check Your Eligibility in just a few minutes without needing to fill in lengthy application forms or risk affecting your credit score. Alternatively, contact our specialist team to discuss your options.  

 

What Can I Use a Working Capital Loan For? 

A working capital loan will give you a helpful injection of cash to use for a variety of business purposes. Below, we’ve listed some of the most common things our clients have used them for: 

Corporation and Income Tax Payments

Ensure smooth financial operations by utilising Working Capital Loans to cover Corporation and Income Tax payments, offering the flexibility needed to meet your tax obligations without compromising your business’s liquidity.

VAT Payments

Stay ahead of your VAT commitments with Working Capital Loans, providing a reliable source of funds to manage VAT payments seamlessly and maintain a strong financial position for sustained growth.

Insurance Cover

Protect your business against unforeseen events by leveraging Working Capital Loans to cover insurance costs, ensuring that you have the financial security needed to navigate unexpected challenges.

Practising Certificates

Secure the necessary certifications for your professional practice with Working Capital Loans, offering the financial support required to obtain and renew practising certificates without disrupting your cash flow.

Software Licenses

Keep your business at the forefront of technology with Working Capital Loans tailored for software licenses, enabling you to invest in essential tools without compromising your working capital.

Annual Subscriptions & Licenses

Sustain your business operations smoothly with Working Capital Loans, addressing the financial demands of annual subscriptions and licenses, and ensuring your continued access to essential resources and services.

 

How Does a Working Capital Loan Work in Practice 

It can be tricky to understand exactly how a business finance product works, which is why we’re using one of our real customer stories to demonstrate the process of applying for and receiving a working capital loan.  

The Client

Our client is a high-end manufacturer and supplier of luxury slate tiles from Europe and South America. Based in the South East with an ever-growing range of commercial and domestic customers.

The Challenge

The growth of the company had led to increased working capital requirements. As a large business with ever-shifting customer demands, they needed flexible additional funding that would give them access to cash flow and certainty in their daily trading.

How we helped

Our team has a thorough understanding of how every business is different – with this in mind, one of our friendly, knowledgeable advisors talked the client through their different options, how each one would work and why it could help take the business to the next level.  

We tailored Invoice Discounting Facility, Inventory, and Property facilities to their needs. This resulted in total facility limits of £10m split between the three asset classes.

This working capital loan solution gave them the solid foundations required to source specialist, exclusive products and materials specific to their UHNW customer demands.

 

Secure a Working Capital Loan from White Oak UK 

The process of accessing that extra liquidity with White Oak UK is simple and straightforward. Apply in minutes, receive a decision within 48 hours (often sooner) and access your funds immediately.  

 

With fixed repayments and no unexpected costs, our working capital business loans offer flexibility and help businesses budget effectively.

 

Get in touch with our specialist experts or apply online now.