What is a Merchant Cash Advance and is it right for you?

11 July 2019

Much like the businesses that they help to support, business funders also change and grow over time.

Not so long ago your choices were limited as to how you could raise funds for your business, which could then be reinvested. However, over time, this has changed and developed.

One of the most recent types of business finance that you can arrange is a merchant cash advance. But what are they and how do they work?

What is a merchant cash advance?

Depending on the industry that they work within, some businesses may not have much in the way of assets which they can then use to secure much needed funding.

Rather than having to struggle to raise funds in order to grow and develop, the world of business finance has come up with alternative finance approaches which will open up business finance to those companies that might not have been able to secure funding previously.

The idea behind merchant cash advances is that they use your card terminal to secure funding for your business.

You don’t need to offer up any security for this lending, instead the company will look at how many card transactions are made each month, and make a decision based on this.

The repayments that are made on the amount that you have borrowed will be taken as a proportion of the money that you make on future card transactions.

Why you might want to take out a merchant cash advance

As this form of borrowing is so quick and easy to organise (as well as being relatively small amounts that are easy to pay back) a merchant cash advance is a great way to raise money that you are going to need for your business in a rush.

It could be to make repairs to a piece of equipment that has broken, purchase new stock or perhaps to invest into something new that you need in order to run properly.

The advantages of merchant cash advances

One of the biggest plus points of choosing a cash advance for your business is that it is incredibly quick and simple to organise.

Our funders will look through your merchant statements and business accounts, within hours, then offer you an amount based on your affordability and card payments that pass through your business.

A merchant cash advance is great for seasonal businesses, restaurants and pubs as you pay as you earn.

If you are having a good month, then you pay back more and vice versa, if you are having a quiet period, then you will pay back less. All with no set timescale or penalties in repaying the advance.

Another great benefit to choosing a merchant cash advance is that it is ideal for those companies who do not have lots of assets to put against their borrowing, such as those that work in the leisure or catering industries.

Merchant cash advances, contact us

Contact The Funding Store to discuss how we can source a competitive merchant cash advance for your business and get a quick quote today.

Share This Story, Choose Your Platform!

What is a Merchant Cash Advance and is it right for you? The Funding Store

Get in touch

This article has been produced by www.TheFundingStore.co.uk for general interest. No responsibility for loss occasioned to any person acting or refraining from action as a result of the information contained in this article is accepted by HPG Holdings Ltd. In all cases appropriate professional legal and financial advice should be sought before making a decision.