Cash Flow Loan

DEFINITION of 'Cash Flow Loan'

Borrowing cash typically to meet day-to-day operations or acquisitions. Reasons for needing a cash flow loan could be seasonal-demand changes, business expansion or changes in the business cycle.

BREAKING DOWN 'Cash Flow Loan'

Cash-flow loans can help in temporary situations, but if cash flow problems persist then companies need to improve their cash conversion cycle and get customers to pay faster.