Everything You Need to Know About Merchant Cash Advance

Business owners are not strangers to funding challenges that come with running a venture. The good news is that you can access viable financing options due to the recent industry trends. A merchant cash advance is one of the viable financing options that you can access to grow a successful business. It has higher chances of approval as compared to other financing options, and it’s flexible. But, some business owners are unaware of this form of financing; hence, they don’t make good use of it. Here are things you ought to know about merchant cash advances.

Cash Merchant Loans

The right place to start is to understand what merchant cash advances are. It’s an advance on future sales that act as working capital as you kick start your small business. Merchant loans don’t rely on credit scores or collateral, which makes them ideal for start-ups. Merchant loans are an excellent option for small businesses because they are easy to get, and they offer a quick turnaround time.

Determining the Payments

The best part about merchant loans is that their payments are flexible. The payments depend on your sales volume, which fluctuates. That means that you can make lower deductions from your sales when your business is going through a dry spell. When your sales volume is high, you can pay off the loan quicker than before.

Loan Repayment Terms

You are probably wondering how a merchant cash advance is repaid. The loans are repaid using a percentage of your future sales. The average repayment period varies based on the loan amount and the interest rate percentage. Usually, the repayment period is between four to 18 months. That’s why it’s integral to select the merchant loan that suits your business needs.

Merchant Loan Benefits

There are a variety of reasons why your small business should opt for a merchant loan to get the capital it requires for its growth and success. One of the primary benefits is fast approval, which can be around 48 hours. Lenders analyze your income stream to gauge its reliability, and not your credit report. The other benefits of merchant loans are that they don’t have restrictions on spending, lack of surprise fees and high approval rates.

Industries That Benefit

Merchant loans are ideal for an array of small businesses. Some of the industries that can benefit from these loans include the retail sector and restaurants. Industries in the medical industry can also significantly benefit from merchant loans.

Take time before taking a merchant loan. Do your homework on the best lenders and a favorable interest rate. You need to make the right decision for your business and its employees.


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