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The mechanics of merchant cash advances
Although both financing methods involve receiving and repaying a sum of money, merchant cash advances are not the same as loans. Rather, the business receives an advance against its future credit card sales, and the provider draws money from the business's future credit card transactions as repayment. Payments are made daily or sometimes weekly.
The repayment amount is based on a percentage of daily credit card sales called the holdback, which may range from 15 percent to 28 percent. For example, if a business does $10,000 in credit card sales, and the holdback is 10 percent, the repayment amount would be $1,000. The holdback percentage doesn't change. However, the payment amount may vary depending on the volume of credit card transactions.
4 Advantages of Using an Instant Cash AdvanceWith an instant cash advance, you can apply for – and get approved – for the money you need within 48 hours. Here are 4 distinct benefits to an instant cash advance:
1. Easy to Qualify ForOne of the biggest advantages to opting for an business cash advance is how easy it is to qualify for one. While big banks place a number of strict lending criteria on borrowers, lenders who offer cash advancements don’t.
Of course there will be some background checks involved, but these alternative lenders are mainly interested in knowing if you’re capable of paying the loan back. Rather than risk having “rejected” stamped on your application process, you have a much better chance of getting approved for a business cash advance compared to a conventional loan at the bank.
2. Cash is Funded Quickly
Typical business loans can seem to take forever by the time you actually see any money, if you’re approved. First of all, the application itself is lengthy and cumbersome. It will then take the bank a long time to review the application before determining whether or not you’re approved. And lastly, it could take weeks before you see a dime after you’ve sent in your application.
On the other hand, a business cash advance is almost instant. You can expect to get your money funded into your account within as little as a couple days – and that includes the application form and approval process. And when you need cash fast, instant is exactly what you need.
3. Convenience
There’s no need to head into a bank and fill out a form in person when you need a loan. Instead, with a fast business cash advance, you can do everything online from the comfort of your own home. And customer service lines at most alternative lender websites are open at much more flexible hours. Whether you choose to call, email, getting the help you need with your funding is as convenient as it gets.
4. FlexibilityThe great thing about fast business cash advances is that they place virtually no restrictions on how you choose to use the money you’re funded with. You can spend the money on any business need as you see fit without having to answer to anyone. Compare this with other types of loans, which usually place restrictions on how you’re allowed to use the money funded.
Contact us to discuss how to better plan your next venture.
Although both financing methods involve receiving and repaying a sum of money, merchant cash advances are not the same as loans. Rather, the business receives an advance against its future credit card sales, and the provider draws money from the business's future credit card transactions as repayment. Payments are made daily or sometimes weekly.
The repayment amount is based on a percentage of daily credit card sales called the holdback, which may range from 15 percent to 28 percent. For example, if a business does $10,000 in credit card sales, and the holdback is 10 percent, the repayment amount would be $1,000. The holdback percentage doesn't change. However, the payment amount may vary depending on the volume of credit card transactions.
4 Advantages of Using an Instant Cash AdvanceWith an instant cash advance, you can apply for – and get approved – for the money you need within 48 hours. Here are 4 distinct benefits to an instant cash advance:
1. Easy to Qualify ForOne of the biggest advantages to opting for an business cash advance is how easy it is to qualify for one. While big banks place a number of strict lending criteria on borrowers, lenders who offer cash advancements don’t.
Of course there will be some background checks involved, but these alternative lenders are mainly interested in knowing if you’re capable of paying the loan back. Rather than risk having “rejected” stamped on your application process, you have a much better chance of getting approved for a business cash advance compared to a conventional loan at the bank.
2. Cash is Funded Quickly
Typical business loans can seem to take forever by the time you actually see any money, if you’re approved. First of all, the application itself is lengthy and cumbersome. It will then take the bank a long time to review the application before determining whether or not you’re approved. And lastly, it could take weeks before you see a dime after you’ve sent in your application.
On the other hand, a business cash advance is almost instant. You can expect to get your money funded into your account within as little as a couple days – and that includes the application form and approval process. And when you need cash fast, instant is exactly what you need.
3. Convenience
There’s no need to head into a bank and fill out a form in person when you need a loan. Instead, with a fast business cash advance, you can do everything online from the comfort of your own home. And customer service lines at most alternative lender websites are open at much more flexible hours. Whether you choose to call, email, getting the help you need with your funding is as convenient as it gets.
4. FlexibilityThe great thing about fast business cash advances is that they place virtually no restrictions on how you choose to use the money you’re funded with. You can spend the money on any business need as you see fit without having to answer to anyone. Compare this with other types of loans, which usually place restrictions on how you’re allowed to use the money funded.
Contact us to discuss how to better plan your next venture.