Get Financing For Your Working Capital And Other Business Needs Through Merchant Cash Advance
If you are a merchant who is in need of additional funding or working capital, you can now opt for a merchant cash advance. There are a lot of small business entrepreneurs like you who need steady financial resources to maintain smooth business operations. The merchant cash advance industry has grown at a surprising manner. This is because banks and other loan companies couldnít cater to all the small and medium enterprises.
Merchant cash advance is a unique way of getting funding. A merchant cash advance company provides the merchant a certain amount of cash advance. What the merchant gives back to the company is the amount being provided plus a certain amount. This amount is a percentage of the credit card sales of the merchant, usually on a monthly basis.
The amount is agreed upon prior to the granting of the cash advance. This would serve as interest to the borrowed money. The percentage is commonly between 10 percent up to twenty-five percent. The agreed percentage varies depending on the situation. The amount of cash advance and type of business could be a factor. The common payback period of a merchant cash advance is between five months up to a year.
A prerequisite in applying for a merchant cash advance is that the merchant must be able to accommodate the type of credit or debit card that the cash advance company patronizes. These cash advances are actually a sale of the future card receivables to the cash advance company.
A lot of merchants have been using this type of financing because of many positive reasons. Applying for financing from banks and other funding institutions is difficult especially for small businesses. The processing takes a long time and prerequisites are difficult to meet. On the other hand, merchant cash advance isnít that strict compared to them and the application does not have a lot of requirements.
Merchants go for this cash advance because the availability of cash is quicker than other funding methods. The cash advance system is made in order to be utilized by merchants especially those that have small businesses. Most small businesses have difficulty getting funding that is why merchant cash advance came to be. It helps these small entrepreneurs get the resources that they lack or need.
Another is that cash advance providers make the cash available in about two weeks. Most banks take longer to approve and that they have a fixed interest rate and a fixed amount to be paid on a fixed date. With merchant cash advance, your payment will rely on the credit card or debit card receivables that come in. If credit card payments are few, you donít have to worry, because the burden is on the cash advance company.
As you can see, going for a merchant cash advance is a good way to get the funding that you need. If you lack working capital, you can easily apply for the cash advance so that you can continue your business operations. If you want to know more about merchant cash advance, you can search the internet for additional information.