Revolving credit · Repayment and cash flow
A revolving credit drawdown is due: what to do if cash is short
A customer has postponed payment, stock is selling more slowly, and the drawdown repayment date has not changed. We explain how to calculate the cash shortfall, prepare a request to the bank and review the proposed terms.
First distinguish the drawdown term, facility term and availability period
A revolving credit facility may run for several years, while an individual drawdown may have to be repaid much sooner. An active facility does not mean that funds already drawn can be used until the facility closes.
| Term | What it determines |
|---|---|
| Drawdown repayment date | When the specific amount drawn, or a scheduled portion of it, must be repaid. |
| Facility term | The end date of the agreed financing arrangement and the date set for final repayment. |
| Drawdown / availability period | The last date on which new funds may be drawn, provided the disbursement conditions are met. |
Also check the debit cut-off time, repayment account, procedure for crediting funds and allocation of payments. Banks may use different names for these periods and define their relationship differently. The basic mechanism is explained in “Revolving credit drawdown term: what it means” .
What to do as soon as you identify a cash shortfall
- Confirm the obligation. Collect the agreement, drawdown request, repayment schedule and current amendments. Record the date, outstanding principal, interest and other payments due by that date.
- Recalculate receipts before repayment falls due. Show account balances, expected receipts supported by evidence and uncertain receipts separately. Receivables reported in the accounts do not necessarily mean cash is available.
- Propose a specific solution to the bank. State how much you can repay by the current due date, how much you want to defer and the source from which you will repay the balance. Attach a cash flow calendar.
- Obtain a formally documented outcome. Submit the request through the bank's prescribed channel and confirm the required documents and review procedure. Track both the decision and when the new terms take effect. Until then, plan around the existing obligation unless the law or agreement provides otherwise.
Contact the bank when you identify the risk, before cash runs out. There is no universal review period: the bank may need financial statements, an authorised corporate decision and security documents.
How to calculate the cash shortfall for drawdown repayment
Negotiations require a cash forecast for a specific date. Deduct operating payments due before that date, interest, fees and the necessary cash reserve from cash balances and expected receipts. The balance shows how much the company plans to allocate to principal repayment.
Illustrative example. Principal of 8 million RUB and interest and fees of 180,000 RUB are due. Account balances total 1.5 million RUB, and confirmed receipts of 4.4 million RUB are expected before the payment date. Operating expenses require 2.2 million RUB, with a reserve of 700,000 RUB. The amount remaining for principal is 2.82 million RUB, leaving a shortfall of 5.18 million RUB.
8 − 2.82 = 5.18 million RUB
This estimate assumes no other amounts are payable. The agreement and applicable rules determine how a partial payment is actually allocated. The calculation supports a proposal to repay part of the debt and defer the balance. First, however, check the following weeks: will receipts cover the deferred debt, additional interest and business operations? If the shortfall recurs each cycle, moving the date once may be insufficient.
Calculate your shortfall
Enter all amounts in RUB for the period before the repayment date. Do not include the same expense in several fields. Do not count a new loan that has not yet been agreed as an expected receipt.
This is a planning estimate, not a bank repayment schedule. Reserves and expenses do not entitle you to reduce a required payment. The calculation does not account for the timing of receipts within the period or interest after the term is extended. A cash flow calendar is needed for that.
For more on scheduling receipts and expenses, see how to calculate a business cash flow gap .
Options to discuss with the bank
| Option | When to discuss it | What to check |
|---|---|---|
| Extension of a specific drawdown | A receipt is delayed, but the repayment source is supported by evidence. | The new date, additional interest, fees and compatibility with the facility term. |
| Partial repayment with the balance deferred | The company can repay part of the debt by the current due date. | How the bank will allocate the payment and which balance will enter the new schedule. |
| Rescheduling / restructuring | The existing schedule consistently fails to match cash flow. | Whether the new payments are affordable, the total cost and the terms of further financing. |
| Refinancing | Existing debt needs to be replaced with suitable new financing. | The new lender's decision, permitted use of funds, security arrangements and actual disbursement date. |
These options are not ready-made offers from the bank. Availability depends on the agreement and the assessment of the situation. Compare additional expenses, security and the credibility of the repayment source as well as the monthly payment.
Some SME borrowers and self-employed people have a statutory right to a grace period if the legal requirements are met. It does not automatically apply to every agreement. Interest continues to accrue during this period. Check eligibility separately from an ordinary extension request.
Documents to attach and what to tell the bank
The request should answer three questions: why the shortfall arose, how much the business can pay now, and how it will repay the balance. “Revenue will arrive soon” is not enough.
- Payment calendar through the proposed new repayment date, including operating expenses and all debt payments.
- Receivables breakdown: customers, amounts, due dates, arrears, delivery documents and payment confirmations.
- Explanation of the cause: a one-off customer delay, slower sales, seasonality or a sustained decline in receipts.
- Details of existing commitments: other loans, leases, guarantees and near-term obligations.
- Proposed amounts and dates under both a base case and a more cautious scenario. Additional documents may be requested by the bank.
Sample request to extend a drawdown repayment date
Replace the fields in square brackets with your details. This template is for negotiating an amendment to the agreement; it is not an application for a statutory payment holiday.
Even if a customer has confirmed the payment date, test a cautious scenario: what happens if the money arrives later? The new schedule should withstand a reasonable delay, otherwise the problem will simply move to the next due date.
Why you cannot automatically count on a new drawdown
Restoration of available credit after repayment and actual disbursement are different events. Check the availability period, disbursement conditions, permitted use and possible contractual restrictions. Not every facility allows a new drawdown to repay existing debt.
The plan “find money for one day, repay the debt and immediately draw it back from the facility” is risky unless repeat disbursement is confirmed. The company may end up with the drawdown repaid and a new obligation to the provider of the temporary funds. Restoration of available credit is explained in the article on revolving credit repayment .
What to check before accepting new terms
- Scope of the amendment: the exact drawdown, amount and date affected.
- Cost: interest rate, additional interest, fees and security expenses.
- Schedule: principal shown separately from interest and other payments.
- Conditions for taking effect: signatures, electronic confirmation, a partial payment or other required actions.
- Effect on the facility: new drawdowns, the limit, availability period and covenants.
- Security: whether pledge, guarantee and insurance documents need to be amended.
Do not rely solely on an “approved” message. Check the signed documents and whether the new terms appear in the bank's system. If the information conflicts, ask the bank for written clarification.
If the bank refuses or payment is already overdue
Confirm the current debt and contractual consequences, update the cash flow calendar and propose a workable solution. A partial payment may reduce the debt, but does not, by itself, remedy the breach or replace agreement on a new schedule.
Do not base the plan on unconfirmed refinancing. If receipts remain insufficient even after an extension, debt and expenses need to be reviewed instead of repeating short deferrals. A demand for early repayment or a security dispute should be reviewed with a lawyer using the relevant documents.
Frequently asked questions about extending a revolving credit drawdown
Does a drawdown extend automatically while the facility remains active?
No. An active facility does not, by itself, move the repayment date of a particular drawdown. Check the agreement: any change must follow its prescribed procedure or another applicable basis.
Is paying interest enough to defer principal?
Only if the existing terms expressly provide for this. Ordinarily, paying interest does not replace principal repayment or mean the bank has agreed to a new term.
How many days in advance should I contact the bank?
As soon as you identify the risk of a cash shortfall. There is no single deadline for all banks and agreements. Confirm the submission procedure and the time needed to review and document amendments.
Can a drawdown be extended beyond the facility term?
This requires a separate review of the terms. The facility term itself may need to be amended, or another financing arrangement may be required. Do not assume that extending one drawdown automatically extends the whole agreement.
Does a letter to the bank defer payments during its review?
An ordinary extension request does not, by itself, suspend payments. The existing obligation remains in force until the terms have been properly amended, unless the law or agreement provides otherwise.