A merchant cash advance is a business organization that gives out capital to credit card accepting companies in their list. It is not necessarily a loan. Once the business makes a sale in the future, a slight deduction is given to the company. Many small businesses are enrolling with these companies especially over the last couple of years because of the many advantages accrued from it.
A merchant cash advance is usually an off the record transaction that is not governed by any laws. It is merely a sales deal. As such, no credit reports are made on the back of the business. This makes sure that it retains its credit-worthiness and collateral property.
Unlike the traditional banks where you have to wait for several weeks or even months before you are given feedback on your loan application, this one is quite easy. The only thing that the company looks for is how long you have been in business and your monthly credit card returns. Many businesses are attracted by this straightforward and simple method employed by the companies.
Because of the little paperwork required when applying for their loans, time taken to process the loan application is very little. Within a span of one week you can get you cash as compared to the long evaluations done by the traditional banks before they consider you for a loan. By so doing, a business is able to take advantage of a favorable situation that may arise in the future.
The companies do not dwell so much on the credit rating of your business. They only check on how well you have been performing over the last couple of months. Any small business that is stable in terms of revenue collection is therefore qualified to apply for their loans. The length of the advance is usually directly proportional to the revenue collected during the previous financial year.
The advances can be returned in different adjustable rates governed by the ratio of sales made by the business. This ensures that the business is not pressed so hard when it comes to paying back the company. If it makes little sales, then the company gets a low commission, unlike the commercial banks that charge a fixed monthly rate.
In addition, once the companies give you funds, they leave you to decide on how to use the money to improve your business unlike the traditional banks that monitor everything you do with their loans. You may opt to expand your business, do some advertisements or renovations if you do not want to use it on working capital. This is good since the business owner knows best what is good for his/her company.
Additionally, one of the best and comforting characteristics of the MCAs is that they have renewals after every three months. This means that you can apply for another funding after three months to improve your business. This sense of reliability attracts small businesses to the companies.
A merchant cash advance is usually an off the record transaction that is not governed by any laws. It is merely a sales deal. As such, no credit reports are made on the back of the business. This makes sure that it retains its credit-worthiness and collateral property.
Unlike the traditional banks where you have to wait for several weeks or even months before you are given feedback on your loan application, this one is quite easy. The only thing that the company looks for is how long you have been in business and your monthly credit card returns. Many businesses are attracted by this straightforward and simple method employed by the companies.
Because of the little paperwork required when applying for their loans, time taken to process the loan application is very little. Within a span of one week you can get you cash as compared to the long evaluations done by the traditional banks before they consider you for a loan. By so doing, a business is able to take advantage of a favorable situation that may arise in the future.
The companies do not dwell so much on the credit rating of your business. They only check on how well you have been performing over the last couple of months. Any small business that is stable in terms of revenue collection is therefore qualified to apply for their loans. The length of the advance is usually directly proportional to the revenue collected during the previous financial year.
The advances can be returned in different adjustable rates governed by the ratio of sales made by the business. This ensures that the business is not pressed so hard when it comes to paying back the company. If it makes little sales, then the company gets a low commission, unlike the commercial banks that charge a fixed monthly rate.
In addition, once the companies give you funds, they leave you to decide on how to use the money to improve your business unlike the traditional banks that monitor everything you do with their loans. You may opt to expand your business, do some advertisements or renovations if you do not want to use it on working capital. This is good since the business owner knows best what is good for his/her company.
Additionally, one of the best and comforting characteristics of the MCAs is that they have renewals after every three months. This means that you can apply for another funding after three months to improve your business. This sense of reliability attracts small businesses to the companies.
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