A Merchant Cash Advance (MCA) is a financial arrangement in which a Business receives a lump sum payment in exchange for a portion of its future sales. It is not technically a Loan, instead, the Lender is actually purchasing your future sales, and you’ll use those sales to repay the “Advance”. Merchant Cash Advances allow you to quickly access Working Capital without going through the lengthy and stringent approval process of traditional Loans.
BUT HOW DOES IT WORK???
Easy… The Business applies for a Merchant Cash Advance below, we then will evaluate the Business’s credit card sales, bank statements, and other financial information to assess its Revenue and repayment capacity. We will take your average monthly turnover into consideration to work out how much you’ll be able to repay comfortably. If approved, your Business receives a lump sum of CASH, which is typically deposited into its bank account.
OK… SO, WHAT ALL CAN I USE IT FOR?
Similar to the majority of short-term Business Loans, you have the flexibility to utilize the funds as you see fit, provided that their purpose is exclusively for Business-related expenditures and not for Personal use. Here are a few instances of the types of expenses for which you may apply your cash advance:
* OPERATIONAL CAPITAL
* WEBSITE DEVELOPMENT
* EQUIPMENT PURCHASE
* BUSINESS FINANCIAL EMERGENCY
* TECHNOLOGY IMPROVEMENTS
* MACHINERY ACQUISITION
NOW TELL ME WHAT ARE THE BENEFITS IN THIS STUFF?
• ADAPTABILITY – Your business is only obligated to reimburse the Funding when it processes customer card payments, aligning repayments with your sales.
• RAPID – Approval for a Merchant Cash Advance can be granted in as little as 24 hours.
• UNSECURED CAPITAL – Merchant Cash Advances fall into the category of “Unsecured Business Financing”, meaning you aren’t required to pledge Business Assets as collateral.
• SIMPLIFIED APPLICATION – While conventional Lenders often demand a comprehensive Business Plan, Merchant Cash Advances typically do not necessitate this.
• REDUCED RISK – Given that repayments are automatically deducted from your card payment receipts, the risk of defaulting on your Loan is typically lower.
• TRANSPARENCY – The total repayment amount remains constant; you will see the exact cost when you obtain the Cash Advance