Merchant Cash Advance
A merchant cash advance is not a loan but, instead, the sale of a company's future bank deposits or credit card transactions for an upfront lump of money. Repayment of the loan is made through the the daily remittances from a company's bank accounts or credit card merchant processing accounts. A merchant cash advance, also known as a business cash advance, is financing based on your future credit card receivables. Few benefits of Merchant Cash Advance are:
Simple and Rational: Unlike traditional funding companies, we are more concerned about the current health of your business and do not focus solely on your personal credit
Hassel free Automated payback process
No Fixed Monthly installment or set time frame to pay us back
We get paid when you get paid in your business
Fast and easy approval process
Quick access to capital
No credit impact to get a quote
Eliminate short term financial needs
Flexible payments based on daily sales instead of a fixed amount
How Do I Pay Back ?
The borrower then pays back the merchant advance through the use of either split withholding, lock box withholding or ACH withholding: Split withholding: When the merchant cash advance company obtains repayment by splitting credit card sales with the borrowing small business. The borrowing company usually receives between 80-90 of deposits/credit card sales, with the merchant cash advance lender taking 10-20% until the cash advance is paid-off. Lock box withholding: All of the borrowing company's credit card sales and bank deposits are placed into a bank account which is completely controlled by the merchant cash advance lender. The cash advance lender then forwards the borrowing company the proceeds (minus the financing company's repayment). ACH withholding: An agreed upon fixed amount is deducted from the borrowing business's bank accounts daily (Monday through Friday not including holidays) until the cash advance is paid back.