Glossary
Short-term funding that covers a gap until a known payment or longer-term funding arrives.
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Short-term funding that covers a gap until a known payment or longer-term funding arrives.
Bridges are used when money is coming, such as an insurance payment, a sale or a loan approval, but not yet here.
It solves timing, not profitability.
A business waiting six weeks for a government grant uses a short advance to cover payroll until it arrives.
Common for grants, tax refunds, insurance and contract payments.
Reviewers like bridges tied to documented payments: a signed contract, an insurance claim or an approval letter.
A bridge to nowhere is just debt. The repayment source should be specific and likely.
Write down the payment the bridge is waiting for, the expected date and the evidence: a signed contract, an insurance adjuster's estimate, a grant approval letter or a tax refund notice. If any of these is missing, the bridge is really a loan with an uncertain repayment source.
Plan for delay. Payments from governments, insurers and large customers frequently arrive later than promised. Size the bridge so that a delay of several weeks does not create a second crisis.
Repay the bridge from the expected payment as soon as it arrives. If the payment is smaller than expected, contact the funder at once and agree a plan for the difference.
A Saskatoon landscaping company wins a municipal contract that pays sixty days after each monthly invoice. Payroll and equipment costs start immediately. A short bridge sized to two months of those costs, repaid as the first municipal payments arrive, fits the situation precisely. A bridge sized to the full contract value would cost far more and leave the company paying for money it did not need.
Key takeaway: A bridge is only as good as the payment it waits for. Name it, date it and size the bridge to the gap, with room for delay.
In a funding file, attach the document that proves the payment is coming. A reviewer can then size the bridge to a dated, evidenced amount instead of a hope, which usually means a faster and cleaner decision.
It is often used as one.
See the related guides and the comparison pages, or apply and ask.
No. It is educational information, and agreements vary.
Educational information only. It is not legal, tax or accounting advice.
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