Merchant Cash Advance Benefits

If you are a small business owner who needs capitol right now, you want to know what your options are. A merchant cash option is something to consider if you are in need of alternative business funding loan for short-term business purposes. An alternative business funding program like a merchant cash advance option does have many benefits to you, but there are a lot of things to consider before you decide if this is the most suitable option for you. By reading on, you can learn all about what a merchant cash advance is and whether or not this is the right approach for your business.

What is a Merchant Cash Advance and When Do You Need One?

One of the most important things to know is that a merchant cash advance is not technically a loan, rather it’s a cash advance that is based on a business’ credit card sales that get deposited into their merchant account. After a business has applied for this type of funding, the money can be quickly deposited into their account in as little as 24 hours after the application has been approved.

The providers of these types of alternative business funding will evaluate the risk and weigh criteria in a different manner than a traditional banker or lender. What happens is the lender will look at your daily credit card receipts so that they can see if a business can pay back their funding in a reasonable and timely manner. However, this means that alternative business funding also comes with higher interest rates than traditional loans. That’s why it’s important to fully understand this funding before agreeing to the terms.

Is a Merchant Cash Advance Right For Your Business?

Now that you know what a merchant cash advance is, the next question is whether or not it is the right choice for your business. This type of funding does have a lot of benefits for a small business, which is important to consider. This can be a good option for your business if you have credit issues and need a short-term financial solution for your business. However, not everyone qualifies for this type of loan (such as someone with a bankruptcy on their record) or if your business hasn’t been open for longer than a year. This also isn’t an option for your business if you don’t process credit card sales.

Benefits of a Merchant Cash Advance

There are several benefits that make a merchant cash advance an enticing option. You should consider these benefits and weigh them against the disadvantages, to determine if this really is the best choice for you. Here are the top benefits that a merchant cash advance offers your business.

Quickly Receive a Lump Sum of Cash

The biggest benefit that people enjoy from a merchant cash advance is the fact that you can get your money so quickly. In most cases, you can get your money in as little as a week depending on the lender. This is important to businesses because they may need their money fast to keep their business operating as normal or to get through a difficult time. This is a fast option for people who need a short-term solution.

Credit Doesn’t Have to be Great

Generally speaking, there are fewer obstacles to overcome to get a merchant cash advance. One of the problems that businesses have is that they may not have the best credit, which limits their options as far as traditional funding goes. Even if you don’t have great credit, you may still qualify for a merchant cash advance.

No Set Repayment Terms

With any traditional loan, you get set monthly payments that you need to make. With a merchant cash advance, you don’t have a set repayment term. You are essentially selling your future profits to your moneylender, rather than actually borrowing money in the traditional sense. If you have a slower month, you won’t have to repay as much that month. With better months, you can pay more.

The Money Can Be Used as You Need It

A problem with certain other loans is that you have strict requirements for what you do with that money. Some loans can’t be used to pay off debts. Some can’t be used to purchase inventory. With a merchant cash advance, you use the money for whatever you need it for.

No-Risk to Assets

Another problem with traditional loans is that it can hurt your credit and cause you to put your assets up as collateral. Merchant cash advances don’t require you to put your assets at risk when you get this alternative business funding. Your acceptance depends on your needs and credit card sales.

Merchant Cash Advance Guide

When you apply for a merchant cash advance, it can be a simple process when compared to getting a traditional loan. The steps are simple.

• It starts with a simple application process, which is usually only a couple of pages and requires your SSN, business tax ID, and various other important details about your business.
• You also need to provide documentation where you need to show your bank statements and several months of your credit card processing details. There are additional documents that you may be asked for, such as your lease for your business or proof of citizenship.
• It doesn’t take long to get approved and receive your money, often only taking about a week to get your money.
• Then you need to get a new card processor approved by your lender.
• Finalize the details of your loan and quickly receive your funds.

As you can see, this is a quick and easy process that you can do to see if you can qualify for this type of funding. You should be aware of a few things. First of all, you can’t use this as a way to build up your credit as these providers don’t report the loan to credit reporting agencies. They can also have interest rates that are significantly higher than standard loans.

Conclusion

If you need alternative business funding, a merchant cash advance could be the option you need. Consider all of this information to make sure that this is the right choice for your business.  If this is the answer for your business, qualify now, CLICK HERE for the application.