Situation

Business funding with negative or low-balance days: how it is read and what helps.

Days when the balance falls below a threshold show how thin the cushion is between deposits and payments.

✓ Checking what you qualify for does not affect your credit score.

How this is read

Days when the balance falls below a threshold show how thin the cushion is between deposits and payments.

Funders count the days a balance dips very low or negative because they are a leading signal of strain. The count and the recent trend matter more than any single dip.

What helps

Fewer low days in the most recent month
Higher average daily balance
Timing payments after deposits
A request that does not add pressure

What hurts

Frequent dips around payroll
A large fixed debit without enough buffer
New obligations without new revenue

A sensible plan

Review your calendar of debits against deposits. Moving supplier payments by a few days or smoothing payroll can reduce low days before you apply.

Illustrative arithmetic

A restaurant depositing about $65,000 a month asks for $20,000 for equipment. At a 1.27 factor the payback is $25,400, a cost of $5,400. Over roughly 5 months that is about $242 per business day, or close to 8% of monthly deposits.

Total payback: $25,400.
Cost: $5,400.
Payment: about $242 per business day, close to 8% of monthly deposits.

Every figure on this page is illustrative arithmetic in Canadian dollars. It is not an offer, a quote or a promise of approval.

Typical starting points

Monthly revenueTypically from around $20,000 a month in deposits for Canadian files. The exact line varies by funder and by file.

Time in businessTypically about 12 months. Newer businesses can be reviewed, but the options narrow.

Account healthLimited low-balance or negative days. Funders read the last few months of bank statements for this.

CreditScores from 500 are considered. A score of 600 or higher opens more options and better offers.

DocumentsA signed application and recent business bank statements, typically the last four months.

Existing advancesFiles with an existing advance can be reviewed, including second position.

Common questions

What counts as a low day?

Typically a day when the balance falls below a few hundred dollars.

Can I fix this quickly?

Often by timing payments better and leaving a small buffer.

Does a large deposit hide low days?

No. They are counted from the daily balance.

Keep reading

Underwriting situationsCredit, NSFs, time in business and more Funding requirementsTypical starting points for Canadian files Documents you needWhat to have ready before you apply Bad credit business fundingHow files with weaker credit are read GlossaryPlain-language definitions

Educational information only. It is not legal, tax or accounting advice.

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