While most businesses will need a loan at some time during its existence. While the need for extra funds is something that is timeless, the types of funding sought has changed. Gone are the requests for massive sums. This could be from the iffy economy and its iffy interest rates. It could also be from the rise of smarter merchants. Big loans are not the best thing for business, and the message is finally getting across to merchants.
While bank loans are notoriously hard for a high risk merchant to obtain, mainstream merchants typically turn to this funding option when their businesses are struggling. The problem is not only the interest rate and payment schedule, but also the high risk of defaulting, thanks to the large loan amounts that are given. Not all merchants need thousands in loans, and it can be hard to turn down large amounts. However, it is the best option to do so. You only need to borrow as much as you need at the time, partly in order to keep your spending down, and partly to afford the privilege of easy payback.
However, as most high risk merchants know, a bank loan is a terrible idea – even in a small amount. The best option for businesses big or small in need of extra funds comes in the form of merchant cash advances. Unlike a loan, a merchant cash advance does not allow for high interest rates and collateral. A merchant cash advance does allow you to get the funds that you need in your business account in as little as 72 hours. For those with merchant accounts, the process is simple because your merchant account provider already has your financial information. As long as you have less than three chargebacks per month, you can be accepted into this program. For those without a merchant account, but have a business checking account, you can also obtain a merchant cash advance. While this method has harsher rules for acceptance, the rate is great for those who meet the criteria. The payback method is also simple: the funds come from your credit card purchases daily.
When you are in need of extra funding, forgo the bank. Instead, contact your merchant account provider and ask about their merchant cash advance services.