BUSINESS FINANCE GLOSSARY
LOC
Line of Credit
Revolving credit that can be drawn, repaid and reused subject to its agreement.
What does LOC mean?
Revolving credit that can be drawn, repaid and reused subject to its agreement. Professionals may calculate, document or apply this concept differently depending on the transaction, accounting method, lender policy and governing documents. Borrowers should confirm the precise definition used in any term sheet or agreement.
LOC in context
A company draws $200,000 for inventory and repays it after customer collections.
Why it matters in financing
LOC can influence how a lender, investor or advisor evaluates risk, pricing, structure, repayment capacity or transaction economics. It should be considered together with the complete financial picture rather than used alone.
Related business finance terms
Educational information only. This definition is general, may not match a particular lender or contract, and is not financial, accounting, tax or legal advice.