For some merchants, finding extra funding is simple. Whether it is a bank loan, a wealthy relative, or a bunch of friends piling their money together, sometimes extra funds seem to come easily. For other merchants, this is not the case. High risk labeled merchants typically have issues finding funding – even if it is a few hundred dollars. The banking industry doesn’t help matters, either; these businesses are often turned down, even if they are successful because of their “high risk” label. While finding funding can be tough, it can be done if you know where to look.
The first mistake when looking for a business loan is, well, looking for a business loan! A high risk merchant does not need the burden of a business loan. The repayment schedule works against a high risk merchant from the start. The interest rates are often sky-high, and the collateral is something that a struggling merchant should not have to risk. But, with a bank loan this is what happens. High risk merchants need not to look for a bank loan, but rather a cash advance for businesses. This service provides funding, but without the collateral, high interest rates, and unsavory repayment schedule.
A merchant cash advance allows you the freedom to have extra funds, without the hassle of one big monthly repayment. Instead, repayments are made when you make a sale, from a percentage taken from your credit card transactions. This percentage is small, and is agreed upon by you and your merchant account provider. If you go a week without making a sale, you are not repaying funds that you do not have. This is the big difference between a bank loan and a merchant cash advance: the repayment schedule helps you become successful. The bank doesn’t care if your business is struggling; they just want their repayment.
Most businesses need extra funds at some time. While the first thought is to go to the bank and apply for a loan, this is often the worst idea. If you cannot get a business loan, or if your business loan would have sky-high interest rates, contact your merchant account provide to discuss your options today. A merchant cash advance may be the answer to your business needs.