A merchant cash advance is a type of financing that provides small businesses with lump sum upfront cash on request. When a business owner is given a merchant cash advance, they repay using a percentage of the business’s sales. A merchant cash advance is a perfect way to get financing for businesses that don’t qualify for a traditional loan, have high credit card sales volume, or need funding quickly.
This article is dedicated to helping you understand what merchant cash advance is, how it works, and its benefits.
How Does a Merchant Cash Advance Work?
Mostly, there aren’t many options for small businesses that need quick access to capital in an urgent moment. This is where merchant cash advance comes in, providing business owners with quick access to cash with flexible repayment terms.
The process of applications is as follows:
- Apply for the cash advance: You’ll be required to provide information about your business, your social security number, and your business tax ID.
- Provide documentation: You’ll be required to submit payments processing data, bank statements, and several months of the credit card.
- Get approved: Your request on advance cash will take about 24 hours to get approved.
- Set up the credit card processing: You may be required to switch to a new card process to process your advance.
- Finalize the details: This is an important step as you’ll be alerted of the amount of money you’ll be required to pay back.
- Receive the funds: Finally, you get your money deposited into the small business bank account, and from there, the repayment automatically commences.
Benefits of Merchant Cash Advance
- Quick and fast- the application process for a merchant cash advance is fast, and one gets a lump sum of cash within 72 hours.
- Flexible payment terms- there are no set monthly payments as you’re only charged a given percentage of your sales.
- You don’t require an excellent credit score- if you have a bad credit score, this won’t affect the approval of your merchant cash advance.
- You can’t lose property- there is no collateral needed, and thus in case you fail to replay back, you won’t risk losing your property.
Hopefully, you now have a better understanding of merchant cash advance at Apickle and how it works. The benefits of merchant cash advance include quick access, high flexibility, and no credit score is required. This mode of financing is best for small businesses that need money within a short period.