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Options for Restaurant Financing That Will Not Break Your Wallet

The restaurant industry is tough. From dealing with ever-changing local, state, and federal health inspection codes, to dealing with unhappy customers, your day can be filled with nothing but headaches. Good staff can make it better, but hiring good staff takes funding. Not all restaurants can afford extra staff, or better staff, leaving them with the cheapest options available. Restaurant financing options are available to help you with your struggles – and they do not involve a dreaded trip to the bank.

While you may breathe a sigh of relief about not having to obtain a bank loan, it isn’t because of the interest rates: a 2014 Harvard study found that banks simply are not lending to restaurants. Restaurants are now in the “high risk” lending category, thanks to their high percentage of closures. Restauranteurs have been left with other options, including crowdfunding sites, friends and family loans, and federal small business loans. Not all qualify for federal small business loans, and friends and family loans are usually a bad idea for obvious reasons. Crowdfunding can work for some, but it is risky whether you will get the funds that you need. The best option comes from your merchant account provider: a merchant cash advance.

A merchant cash advance is not a loan. A merchant cash advance is an advance on your future sales. In addition to simply “not being a loan”, the requirements for obtaining a merchant cash advance are simple: no tax returns or financials are required, FICOs under 500 are accepted. Other than this, there are no strict requirements. Now, a merchant cash advance is only available to those with merchant accounts, because this is where your payments come from. For those without a merchant account, look into an ACH cash advance, which operates with a business checking account. The payment schedule is simple, because a small increment is taken from each credit card sale that you make. There are no large lump payments monthly. You will keep the money you earn, and you can avoid risking a huge interest increase from a missed payment. Perhaps best of all is that you can receive your funds in as little as 72 hours.

For more information about your restaurant financing options, contact FAM or your merchant account provider today.