Your small business needs cash – and fast. After doing some research, you are leaning towards a merchant cash advance, but are not sure of all the ins and outs of this business funding option. If you would like to learn more, the following information will help you.
How does a Merchant Cash Advance Work?
Contrary to popular belief, a merchant cash advance is not a loan; it is a purchase. Essentially, the provider is purchasing your future sales at a discount in exchange for quick cash. A merchant cash advance allows your business to secure cash quickly and easily with no need for collateral – even if your credit score is less than stellar. This lump sum of cash is repaid using an agreed-upon portion of your business’ future daily credit and debit card transactions.
A few of the many benefits of a merchant cash advance include:
- Fast, straightforward application process. Applying for a merchant cash advance is quick and easy. Unlike working with a traditional provider, the documentation requirements are minimal. No tax returns or financials required, and there are no complicated contracts involved. The application itself can be completed in a matter of minutes, and a response is received within 24 hours.
- Quick cash. Once approved, your business can receive its funds in as little as 72 hours. The biggest advantage of the speed of a cash advance is your ability to quickly turn around and boost your business’ cash-flow. This cash can also help you increase inventory, purchase new equipment, fund marketing campaigns and seize other opportunities.
- Improve your credit. Because a merchant cash advance is not a loan, it will not negatively affect your business’ credit. You are selling your business’ future credit card sales for cash, so you will not be paying monthly payments. In fact, using a merchant cash advance will actually improve your credit if you choose to use these funds to pay off debt.
Where to Find the Best Merchant Cash Advance
The key to finding the best merchant cash advance provider is to take a closer look at your business itself. Is your industry considered “high-risk” with traditional providers? Does your business type make banks nervous? If so, a high-risk specialist like First American Merchant will likely be your best option.
As a high-risk provider, FAM has years of experience in offering affordable cash advances to businesses that struggle to find solutions elsewhere. The following are just a few of the many industries and business types FAM offers a merchant cash advance to:
- Automotive
- Beauty salon
- Bars & nightclubs
- Construction
- Dentistry
- Doctors
- Hotel & Motel
- Retail
- Trucking
The Cost of a Merchant Cash Advance
If your business needs quick cash to improve cash-flow, purchase equipment and inventory or cover repairs, consider a merchant cash advance with FAM. Repayment involves revenue-based collections, which means we get paid when you get paid. Because payment is a percentage of your daily sales, if you have a slow month your business pays back less. If it has a good month, it pays back more. This flexible structure ensures your business is always be able to afford the payments. Once you have been approved, you are free to renew your advance when 50% of the original balance has been paid down.
If you would like to learn more about our merchant cash advance broker services, contact us today to get started.