Advantages of Using Merchant Cash Advance
A merchant cash advance is a form of business loan where you receive money based on a calculated percentage of your daily credit card receipts. A lender uses the historic average from your receipts along with information from bank statements to determine the initial amount to borrow you as the business owner. You would then repay the lender from your credit card receipts plus interest.
Below are three advantages to consider with a merchant cash advance.
Maintain Consistent Cash Flow
Business can be extremely cyclical, especially when you only operate during certain seasons of the year. That means the amount of money you have available at any time to pursue new business ideas can vary considerably. When you borrow the money through this type of loan, you are assured of having the cash available to you when you need it. That can help you eventually get to a point where you no longer need to borrow because you have been able to save to prepare for cash inconsistency throughout the year.
Buy Equipment or Prepare for a Busy Time of Year
It is impossible to hire additional staff to meet a seasonal rush or buy more equipment to help grow your business when you don’t have the money available to do so. A merchant cash advance gives you those funds so you can say yes to new business opportunities as they present themselves. The lender will typically direct deposit the funds from your loan directly into your business bank account.
Saves You Time with Traditional Funding
Obtaining a traditional bank loan is a long and involved process. Unfortunately, you have no guarantee of approval even after spending all that time getting your application materials together. A merchant cash advance is easier to qualify for and the process of approval goes much faster as well.
ASA Capital is happy to answer your questions about this or any other non-traditional type of loan. Please contact us today.