Inventory loans, known also as inventory financing, are lines of credit or short-term loans designed to assist small businesses to purchase inventory. Inventory funding is used for exactly what it sounds like – to purchase additional inventory needed to run your business.

With this type of loan, existing and future inventory is used as collateral against the loan provided. This form of inventory funding can be a great instrument to grow your business when the market is demanding your expansion but you dont have enough capital for inventories.