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What it measures
The current ratio divides current assets by current liabilities. Above 1.0 means you can cover short-term bills from short-term assets; too low signals a squeeze, very high can mean idle cash.
How lenders use it
Lenders read it as a solvency signal. A healthy ratio supports a stronger borrowing case; a weak one prompts questions. Improve it by collecting faster and managing short-term debt. See reading your balance sheet.
What it means for you
Credicorp lends to your company, not to you personally, and takes no personal guarantee. See business loans or apply online.
Frequently asked questions
What if my current ratio is below 1?
It means short-term liabilities exceed short-term assets, which can signal a cash squeeze. Some efficient businesses run it deliberately, but for most it is a flag to address.
Can a current ratio be too high?
Yes. A very high ratio can mean cash or stock sitting idle rather than being put to work. A comfortable cushion is healthy; excess is inefficient.
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