What is Merchant Cash Advance?
A merchant cash advance allows a business owner who accepts credit card payments or has other payment or receivables streams to obtain an advance of the funds regularly flowing through the business merchant account.
A merchant cash advance (MCA) is not a loan, but rather an advance based upon the future revenue or credit card sales of a business. A small business can apply for an MCA and have an advance deposited into its account fairly quickly.
Merchant cash advance providers evaluate risk and weight credit criteria differently than a traditional banker might. An MCA provider looks at the daily credit card receipts to determine if the business can pay back the advance in a timely manner.
Rates on a merchant cash advance are typically higher than other small business loan options (sometimes higher than triple digit annualized interest rates). An MCA provider will often approve an advance for a business that might not qualify for a business loan, but has a steady influx of credit card payments. Any business owner considering this option should make sure he or she understands the terms being offered so they can make an informed decision about potential ROI.
The Application Process
The time it takes to get approved for an MCA could be anywhere from an hour or two to a few days, depending on the provider. Once the application is approved, a business could see the funds in their account within two days.
The application process isn’t as complicated as a traditional loan, which often makes the merchant cash advance approval process a faster option. Here are the typical steps a business needs to take:
- Apply for the advance
- Provide documentation
- Get approved
- Set up the credit card processing
- Finalize the details
- Receive the funds
Do you qualify for a merchant cash advance?
- Apply for your share of $100 MILLION funding loans to small businesses.
• $3,000 TO $150,000 per business in 10 DAYS or LESS!
• Have been in business at least 1 year.
• Accept credit cards as a form of payment.
• Can provide current credit card processing statements from the past 6 months with at least $4,000 per month in credit card sales.
• Provide the past 6 months’ statements of bank accounts to qualify for larger amounts.
• Acceptable personal and business credit.
• No open tax lines, judgments or bankruptcies.
• Good standing with landlord with at least 1 year remaining on the lease.