Revolving Loan Facility

Revolving Loan Facility
A financial institution that allows the borrower to obtain a business or personal loan where the borrower has the flexibility to decide how often they want to withdraw from the loan and at what time intervals. A revolving loan facility allows a company to drawdown, repay and re-draw loans advanced to it. This type of loan is considered a flexible financing tool due to its repayment and re-borrowing flexibility.

A loan from this facility is provided over a specific period of time, usually one, three or six months. It is not considered a term loan because, during this allotted period of time, the facility allows the borrower to repay or take the loan out again. It is also different from a fixed monthly payment loan because a revolving loan lets borrowers use as much of the credit as is available and only pay interest on what they have used.


Investment dictionary. . 2012.

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Look at other dictionaries:

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  • revolving facility — A committed facility allowing a borrower to draw down and repay amounts (up to a limit) for short periods throughout the life of the facility. Amounts repaid can be re borrowed, thereby combining some of the flexibility of the overdraft facility… …   Law dictionary

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