Payroll runs Friday. Your biggest client invoice — $41,000, net-60 — clears in six weeks. This is the gap that catches more women-owned service businesses off guard than any tax deadline or slow sales quarter, because it has nothing to do with whether the business is profitable. A design studio billing $600,000 a year can still miss payroll if three invoices land late in the same month. The fix usually comes down to two tools: a business line of credit or a business credit card. They solve the same problem in different ways, and picking the wrong one costs real money over a year of use.
What each tool is actually built for
A business line of credit is revolving capital tied to your business's cash flow and time in operation, typically issued by a bank or an online lender like Bluevine or Fundbox. You draw what you need, pay interest only on the drawn amount, and the available balance resets as you repay — closer to a home equity line than to a loan. Bluevine's line of credit runs 6.2% simple interest and up, with credit limits from $5,000 to $250,000, and most approvals land within 24 to 48 hours for businesses with at least six months of operating history and $10,000 in monthly revenue. A business credit card, by contrast, is unsecured revolving credit built around a fixed limit, a grace period, and rewards — Chase Ink Business Unlimited and Amex Blue Business Plus are the two most common starting points for founders under two years in business, both with no annual fee and 0% intro APR windows of 12 months.
The real difference shows up the moment you miss the grace period. Carry a balance on a business credit card past the due date and you're paying 19% to 29.99% APR — Chase Ink Business Unlimited sits at 19.24%–27.24% variable as of this writing — compounded daily on the full balance, not just the amount over 30 days late. A line of credit's interest accrues only on what you've drawn, and most lenders let you repay early without penalty. If you're bridging a six-week invoice gap and repaying in full the day the client pays, the math flips: a card used correctly (paid off inside the grace period, ideally within 25–30 days) costs you nothing beyond the float. A line of credit used for the same six weeks costs whatever the draw accrues daily, even if that's a modest $180 on a $15,000 draw at 8.9%.
Where approval actually gets hard
Here's the part most founders don't find out until they've already applied and been declined: banks and most online lenders want two years of business tax returns and $100,000+ in annual revenue before they'll issue a line of credit above $50,000 without a personal guarantee and often a UCC lien on business assets. Fundbox and Bluevine will approve younger businesses — six months of history is their floor — but at smaller limits and higher rates than a business two years in with clean books. A business credit card's underwriting leans harder on your personal credit score (typically 670+ for approval, 700+ for the best intro APR offers) precisely because most small-business cards are personally guaranteed regardless of your LLC or S-corp structure. That guarantee matters: a missed card payment shows up on your personal credit report the same way a missed line-of-credit payment can, but the card issuer will come after you personally faster because there's no business collateral standing between you and the debt.
Neither tool is free money, and treating either one as a substitute for a cash reserve is the mistake that sinks otherwise healthy businesses. A line of credit you draw down to cover payroll every single month isn't a bridge — it's a sign your pricing or your collection terms need to change before the debt does. Get your invoicing to net-15 or add a 2% early-payment discount before you reach for either financing tool; fixing the actual timing gap costs nothing and a line of credit costs something every month you carry a balance.
Fees that don't show up in the headline rate
- Draw fees: some lines of credit charge 0.25%–2% every time you draw, on top of the interest — check this before comparing APRs side by side.
- Maintenance or unused-line fees, usually $10–$50 a month, charged whether you draw or not.
- Foreign transaction fees on cards (2.7% on cards without a waiver) if you're paying overseas contractors or suppliers.
- Cash-advance treatment: pulling cash against a business credit card, rather than charging a purchase, usually loses the grace period entirely and starts accruing interest the same day — this is the single most expensive mistake we see founders make with cards.
The call, if you actually have to make it this week
Use a business credit card for predictable short gaps you can clear inside the grace period — a vendor deposit due before a client payment, a software renewal that hits before revenue does. Use a line of credit for recurring seasonal gaps you can see coming: a bookkeeping firm that bills heavy in Q1 and thin in Q3, a catering business with a slow January every year. Don't open a line of credit as a rainy-day fund you never intend to touch — most issuers charge that unused-line fee whether you draw or not, and an unused $100,000 limit does nothing for your business except sit on a lender's risk file next time you apply for something bigger.
The businesses that get this wrong tend to make the same error twice: they open a card for the 0% intro APR, use it for a large one-time purchase — new equipment, a office buildout — and then still have a balance on it when the six-week invoice gap hits three months later. Now they're financing two different problems on one tool, at whatever rate kicks in after the intro period ends. If you already know a big purchase and a cash-flow gap are both coming, separate them: card for the purchase inside its 0% window, line of credit drawn and repaid specifically against the invoice timing. Mixing them is how a manageable $15,000 gap turns into a $40,000 revolving balance nobody remembers opening.