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WHAT IS A MERCHANT CASH ADVANCE?

A merchant cash advance or MCA is short-term financing used by businesses to meet financial and operational needs. A merchant cash advance is technically not a loan, it’s known as alternative business funding and not covered by the same rules and regulations as other types of financing such as a short-term loan from a conventional bank, small business loan, or term loan. The proceeds of an MCA and repayment of the cash advance are generally based on historical credit card or debit card sales; and future credit card/debit card receivables.

 

Put simply, we provide a lump sum amount of cash based on an anticipated amount of credit card/debit card sales from your business operations. The purpose of a merchant cash advance is to accelerate the business owner’s cash flow, allowing the capacity to take quick advantage of upcoming growth opportunities.

Fast Financing For Your Business

Businesses who accept credit card payments and are in need of quick capital are ideal candidates. Remember, aside from being simple and have a much easier application process, a merchant cash advance provides flexibility with variable payments based on business receivables. If your business has high credit card sales, revenue receivables, or is seasonal, then a merchant cash advance might be ideal for you.

 

Quick Application

Applying is quick and simple and remittances are automatically debited from your account at a fixed rate each month, giving you the peace of mind that your remittances will stay consistent.

 

Flexible Funding

Because your monthly revenue may go up and down, we give you the option to request an adjustment to your remittances to better fit your revenue of that month.

Automatic Remittances

Automatic remittances are based on a factor rate and are gradually debited as a percentage of future credit card and debit card sales. Remittances are automatically deducted from the business bank account where funds were deposited.

Avg. Term Length: 3 - 24 months

Merchant Cash Advance Details

Minimum Qualifying Criteria:

Required Items:

  • 700+ credit score

  • 12+ months in business

  • $10,000+ average monthly bank deposits

  • Signed one page funding application

  • 3-5 most recent business bank statements

  • Business tax returns (not all cases)

No Collateral Requirements

 

Advantages

  • With flexibility on what you can use the funds for, a cash advance is a great short-to-mid-term solution for many business cases.

  • Remittances will always be the same each month so that there are no unforeseen expenses based upon the fluctuation of your revenue.

  • Because MCAs look forward and not backward, they are typically easier to qualify for even if you do not have strong business credit. 

 

Disadvantages

  • If you would like to request that the remittances are in accordance with the revenue fluctuations that will have to be adjusted after the month has ended.

  • MCAs are shorter in duration which means they may not be as effective for financing long term growth objectives.

  • Business cash advances can be more expensive than other alternative funding structures.