Merchant Cash Advances: The Whole Deal

For every start-up to establish them, the need for funding rises several times along the way. Now, you must have heard about the option of merchant loans or utilizing a merchant cash advance when it comes to funding your business effectively and quickly.

However, you’re completely new to the concept of Merchant Cash Advances? Well, no issues!  You will get all the details you need right here:merchant loan

1)What are Merchant Cash Advances?

Let’s assume your business allows client’s to purchase items using credit cards. So, here is where Merchant Cash Advance comes into play. This type of money lending isn’t exactly like merchant loans, but rather a hefty payment made that is repaid by utilizing a portion of one’s regular credit card receipts.

So, in order for one to achieve this so-called loan, a business owner will have to first consult a Merchant Cash Advance provider who will go over the owner’s credit card receipts.

Depending on the influx of payments made, the owner will decide upon an amount to be paid to the business owner. This amount will they be repaid in a given time span.

2)How Does an MCA work?

As mentioned above a business owner will have to contact an MCA provider and decide upon the amount to be borrowed. Now, after that, the MCA provider and the business owner will jointly decide upon holdback percentage and payback amount, depending on the revenue generated from the credit card sales.

This means a portion of the owner’s regular credit card revenues will be held back to repay the loan amount. This holdback’ process will continue till the entire amount borrowed is repaid.

3)How Does an MCA Benefit Your Business?

Unlike merchant loans, a merchant cash Advance has several noted benefits that make borrowing and returning money quite easily.

merchant loan advance

Check them out:

  • Quick Funding

The biggest perk of a Merchant Fund Advance is that it allows funding to be done within a matter of days. Your MCA provider will look into your credit card receipts and estimate the amount of loan you are eligible for. Then this amount will instantly be transferred to your bank account giving fast cash.

  • No Need for Collaterals

In the case of merchant loans from banks, the bank will generally request you to keep some collateral to sanction the loan. However, MCA’s don’t require the submission of collaterals and instead, the amount will be cut from your credit card revenues.

merchant loans

  • Flexible Payment Options

Unlike banks that require you to pay a certified amount as payment each month, MCA’s allow an owner to negotiate payments. Say, you can pay 15% of your credit card revenue the first month and 20% the next; this flexibility can be achieved once you talk it out with your MCA provider.

So, now do you see why it’s more applicable to go for MCA options rather than merchant loans from banks? This time securely fund your business and return the money without worry, just contact your trusted MCA provider.