The Benefits of Merchant Cash Advances for Small Businesses
One of the one of the most important aspects of any business, whether large or small, is cash flow. Regardless of how well the business is doing, suppliers always have to be paid, inventory always has to be purchased, employees have to be paid, and money needs to be set aside for business growth. That makes it very important to have alternative methods of raising cash, since incoming revenues tend to be erratic in nature. One great way to raise additional cash is through merchant cash advances.
What is a merchant cash advance?
This is an alternative lending financial product which works best with businesses that have a high volume of credit card sales. An alternative lender can provide immediate cash to a business owner in exchange for a certain percentage of future business credit card sales. In effect, the lender receives monthly income from the business owner which is directly proportional to the volume of credit card sales, until the amount of the cash advance has been paid off.
Advantages of a merchant cash advance
There are number of reasons why a merchant cash advance is highly advantageous to a business owner. The first reason is that there is no need for the owner to put up any kind of collateral, and it’s not necessary to have a high business credit score. There are really only two main considerations for a lender, the first of which is how long your company has been in business, and the second being the volume of your monthly credit card sales.
If both of these are favorable, chances are good that you will be approved. In fact, this is another huge advantage of working with a merchant cash advance, because approval rates tend to be very high, especially compared to loan rates from traditional lending institutions like banks. Also unlike banks, a merchant cash advance can be set up and implemented very quickly, with very little paperwork necessary. Bank loans often take months to be fully processed, whereas a merchant cash advance is often set up and processed in just a couple days.
Perhaps one of the best benefits of a merchant cash advance is that during periods of slow business, only a small amount will be deducted by the lender, since loan repayments are always proportional to credit card sales. This again is unlike a traditional bank loan, where you would have to pay the same fixed amount every month, regardless of how well or how poorly your business was doing.
Merchant cash advances with ASA Capital Funding
If your company has a typically high volume of credit card sales each month, it may be possible to setup a merchant cash advance through ASA Capital Funding. Contact us today, so we can discuss some possibilities which may be highly advantageous to you and your business.