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Revolving Credit A revolving credit is similar like that of line of credit. It refers to an amount of money that can be borrowed by a business when in needs capital. It is often measured by check, ATM or business card. It is a kind of credit which does not have a fixed number of payments against installment credit. In this kind of credit, the borrower may use or withdraw cash up to a preapproved credit limit. The available credit amount either decreases or increases depending upon the borrowings and repayments. The major attraction of this kind of credit is it can be used repeatedly. The borrower usually pays the actual amount withdrawn in his addition to its interests. The borrower can reimburse the money over a period of time which is generally according to some minimum payment requirement or in full whenever he wants. The revolving credit works similar to a credit card, line of credit or some loans like home equity loans More Glossary Terms Explained here |
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