Which funding product have you been going for lately? Is it working for your business or do you feel like you need a better option? Well, there are alternative business loans to go for. Have you heard of MCAs, also known as Merchant Cash Advances?
Well, you must be curious to understand why this new-age business financing option is taking over other popular forms of micro-business funding and why merchants are increasingly choosing merchant cash advances over small business loans.
Many retailers mistake a merchant cash advance for a short-term loan, or maybe a high-interest advance. But in reality, it is just a sale. The Cash Advance provider is buying your oncoming sales, but at a discount; and both parties settle on the portion of sales on the purchase and for what cut-rate cost.
MCAs Vs. Small Business Loans: Why is an MCA a better option?
Small Business Loan
- Complicated contracts
- Extensive documentation
- Strict credit requirements
- Long waiting periods
Merchant Cash Advance
- Low FICO Score (below 500) Approval
- You receive finances 72 Hours from the Application time
- Straightforward, flexible programs
- No-tax returns required
Top 5 Reasons You Should Consider a Merchant Cash Advance
1-Quick Funding and Instant Renewals
FAM business funding programs can have the money deposited to your bank in as little as 72 hours. And once you are accepted, you can have the advance renewed when you’ve paid down 50% of your balance.
2-High Approval Rate
MCA is based on the performance of a business performance instead of personal credit, time in business or finances.
3-Revenue Based Payback
The cash advance provider takes a portion of your day to day sales. FAM collects more when you have a good month and less when sales are low. This means you can always afford to pay back.
4- “No Hassle” Settlement
You don’t need to write monthly checks; payments are automatically remitted from your credit card transactions. Also, there are no fixed per-month payments.
5-No Collateral requirements
Unlike commercial small business loans, merchant cash advances are merely sales transaction and aren’t included on credit reports. As a result, no collateral is needed as with business loans.