A merchant cash advance is a funding option that most successful small and medium businesses, popularly known as MCA’s, have explored. With this option, firms have been able to receive their much-needed working capital and expand. What is a merchant cash advance? What does it entail? Keep reading to learn more from KEYS FUNDING GROUP, your go-to place for everyday working capital.
What is a merchant cash advance?
A merchant cash advance is a way to get funding for your business. To make it easy for you to understand, you may look at it in the same way that you view a bank loan, except that now it does not come with the inconveniences of bank loans. Please remember that a merchant cash advance is not a loan. It does not have interest nor defined term. In the same breath, a cash advance company is not a lender.
The rise in merchant cash advance is mainly based on the fact that small businesses get an alternative financing option other than traditional bank loans. When you apply for one, the MCA is given a lump sum upfront payment for which you repay based on a percentage of business sales. An MCA works best for firms looking for quick funding, those that register high credit card sales volume, and those that may not qualify for a traditional loan.
Advantages of MCA
It would help if you went for a merchant cash advance because of the following merits:
1.Quickly get lump sum cash for business growth
One of the most significant advantages of merchant cash advance is that it takes away the setbacks of long waits before you get your cash. The typical wait time is 24 hours, with the possibility of exploring a same-day service to get your funds within a couple of hours.
Running a successful business requires you to pay close attention to the time factor. Similarly, an improvement in your cash flow goes a long way in beating the competition. With these factors in mind, MCA puts you on the edge of competitors by giving you quick access to cash without unnecessary delays. KEYS FUNDING GROUP explores this benefit to empower your business and take it to the next level.
2.Your credit will not let you down
Businesses often have a hard time securing loans from the bank because of bad credit. In the long run, after filing endless paperwork, they get turned down due to this one major factor.
Enter merchant cash advance and credit no longer becomes an impediment. Yes, an MCA considers credit, but this is not the overall determining factor, unlike banks. You will qualify even without a stunning credit score.
The central fact that a merchant cash advance company is concerned with is that you are making a certain amount of credit card sales monthly. As you would imagine, this becomes a motivation to the business to push its sales to the limit.
3.You do not worry about a set payment amount
As mentioned above, an MCA is not technically a loan. For that reason, you are not subjected to forced monthly payments that come with consequences when not done. The only agreement you have to acknowledge is that you will make the repayment in the form of a certain percentage of future credit card sales.
As a result of this consideration, those who take an MCA are not classified as borrowers. The ideal angle to look at is that you will let go of a small portion of your profits until the funding received is cleared. Thus, if your sales a slow in a particular month, you will remit smaller amounts.
A merchant cash advance is a worthy funding option that you should consider when you want to take your business to the next level. It is the most convenient way to keep your cash flow intact. At KEYS FUNDING GROUP, we are the leading provider of small business financing.