How to Qualify for a $1M–$3M Business Line of Credit
A $1M–$3M line is the point where lenders stop looking only at your bank deposits and start sizing the facility off receivables, inventory and cash flow. We prepare the credit package and place the request with banks and private credit funds that fit the business.
Most lenders look for roughly $4M–$15M in annual revenue, two or more years of verifiable financials, and enough eligible receivables and inventory to support the limit. A $2M line, for example, typically needs about $2.4M or more of eligible receivables at an 80–85% advance rate.
Discuss your $1M–$3M request
Tell us what you need, your timeline, and the context behind your transaction.
- A review of your business and capital needs
- Placement options aligned with your transaction
- A clear conversation about the next steps
$1M–$3M revolving credit: what lenders generally look for
General market observations used by banks and private credit funds at this size.
| Benchmark | Typical range |
|---|---|
| Annual revenue | Roughly $4M–$15M |
| Operating history | 2+ years with reviewed or tax-return financials |
| Sized off | Eligible receivables, inventory and cash-flow coverage |
| Receivables advance | Commonly 80–85% of eligible AR under 90 days |
| Inventory advance | Commonly 40–60% of eligible inventory, often capped |
| Pricing basis | Spread over SOFR or Prime, plus unused-line fees |
| Renewal | Typically 12–36 months |
Educational ranges only. Independent capital providers set eligibility, pricing and terms.
Who a $1M–$3M line fits
- Distributors, manufacturers and service firms with creditworthy commercial customers
- Companies whose current bank line is capped below what receivables can support
- Seasonal inventory builds that convert back to cash within one operating cycle
- Growing payrolls that run ahead of customer payment terms
Outside what we place
- Businesses without billed receivables or operating history
- Paying off merchant cash advances or consolidating existing debt
- Long-life purchases such as equipment, which belong on a term facility
Illustrative example: sizing a $2.5M line
A $12M-revenue industrial distributor has $2.6M of receivables and $1.4M of inventory. After excluding $200K of receivables past 90 days, eligible AR is $2.4M.
At an 85% receivables advance ($2.04M) and a 40% inventory advance capped at $500K, availability is about $2.5M. Illustrative only — actual advance rates and eligibility are set by the capital provider.
Documents to prepare
- Two years of business tax returns or year-end financial statements
- Current-year interim profit and loss and balance sheet
- Accounts receivable and accounts payable aging reports
- Inventory report by category and location, if inventory is included
- Schedule of existing debt and liens
Frequently Asked Questions
Common questions about $1m–$3m revolving credit.
As a general guide, lenders look for annual revenue of roughly six to eight times the requested limit, so about $12M–$16M for a $2M line. Strong receivables or margins can offset lower revenue. This is an educational range, not an approval standard.
Get a confidential placement review
Tell us what you need, your timeline, and the context behind your transaction.
- A review of your business and capital needs
- Placement options aligned with your transaction
- A clear conversation about the next steps
Tzortzis Capital evaluates and arranges capital placements. Independent capital providers determine eligibility, pricing, documentation and closing timing. Published ranges are indicative, not approvals or commitments.