Merchant Cash Advance - Top Five Advantages Over A Bank Loan Or A Line Of Credit

By Author: Daljeet Sidhu
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Are you looking for a quick loan option? Is the economic slump retarding business growth? Is a low credit rating preventing you from giving your business the money it needs? Are you exhausted by the rigmarole involved in getting a loan sanctioned? Are you praying for a way to get funds in a quick, straightforward and efficient manner? If yes then merchant cash advance (MCA), also called a business cash advance, is the solution that will finally ease your troubles.

Merchant cash advance offers small and medium-scale businesses a fast and straightforward means of acquiring funds for things like maintaining inventory, paying bills on time and for expanding the business. With merchant cash advance, you trade credit sales for a lump sum of cash. MCA providers charge a set cut, typically in the neighborhood of 8 percent of total credit card receipts per month. If the depression induced shaky credit ratings or guarantee prerequisites are preventing you from getting approved for bank loans, then an MCA is particularly a useful option for you.

Here are the advantages merchant cash advance has to offer.

1. No collateral ...
... at stake

Merchant cash advance is treated as a purchase or a sales contract and not a loan. Hence, if you are unable to pay back, it does not hurt your credit score which is certainly not the case with commercial bank loans that can leave a lasting mark on your credit report. You also do not face the threat of losing pledged security, making MCA a comfortable and safe funding alternative for your business.

2. Trouble-free application and disbursement process

Most MCA providers include an application form on their website. Filling the application is quite simple as it does not require tax returns, financial statements or business plan as accompanying credentials.

MCA providers base their decision on two factors - monthly credit card sales volumes and number of years in business - to appraise your financial fitness for receiving the advance and calculating the value. Typically, you should see monthly credit card sales of over $5000 and more than nine to twelve months in business to be considered for for this type of loan.

3. Rapid turnaround

Merchant cash advance being a minimum paperwork deal involves very fast approval cycles. In fact, the funds will be typically credited to your account within a week of submitting the request. This is a huge plus point over traditional bank loans that necessitate waiting periods of weeks or months, preventing you from paying your bills, buying inventory, paying your employees and capitalizing on emerging opportunities.

4. High approval rate

MCA providers value your current business performance over credit score. This allows any stable business irrespective of the past to procure an advance without hassles. Your average credit card sales in the last few months will be factored into calculating the approved MCA funding amount.

5. Revenue-based payments

Unlike traditional bank loans with set monthly installments, MCA payments synchronize with your monthly credit card sales revenue. You must pay a set cut of your monthly credit card receipts. When your business is booming you pay more. When your business is going through a lean period, you automatically pay smaller sums. This approach ensures that the advance never turns into a heavy financial liability on your business, draining all its funds.

In addition to these benefits, MCA gives you a competitive edge by allowing you to seize business opportunities without losing precious time. In business, losing time is losing money. If you keep waiting for a bank loan to get approved, you are doing injustice to your business. Opting for a merchant cash advance over a conventional loan can take your business to the new heights it deserves.
About Author:
Daljeet Sidhu is at TradeSeam B2B Marketplace Business Cash Advance blog. Merchant Cash Advance advice.