What is a Merchant Cash Advance?
When a business needs funding to grow, previously it may have considered getting a business loan or an overdraft facility. But the provision of these from banks these days is in decline and a Merchant Cash Advance is the new alternative solution. It's flexible and simple!
If your business takes payment from credit and debit cards through terminals - Merchant Cash Advance (sometimes known as Business Cash Advance) is a great flexible source of funds. We understand cash flow is the lifeblood of businesses but no two are the same. So a Merchant Cash Advance allows you to keep running and growing your business, while the funding provides you to access a consistent source of funds for as long as you need it.
How Does it Work?
Merchant Cash Advance is a simple concept, where the pricing is flexible and is structured and tailored to your business. The repayment is one fixed cost - calculated as a small percentage of your credit card transactions. With the payments taking care of themselves mirroring your cash flow.
The upfront Cash Advance amount is agreed based on average monthly card transactions for your business. With the total repayment figure based on a factor rate. The whole Cash Advance is provided upfront for the business to use in any way it needs.
Repayment is then a fixed percentage that is automatically collected from future credit/debit card sales. For example, a customer pays you £150 with an agreed % split of 10%. So your business would receive £135 and the lender receives £15 off the Cash Advance.
There are no fixed monthly payments and no fixed terms. You only pay when you earn. When business is slow you pay less, when it's blooming you pay more! Simple.
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Does my business qualify for Merchant Cash Advance?
- Merchant Cash Advance is only available if you have a Credit / Debit card machine
- Minimum £2,500 monthly average in card takings
- The Cash Advance is suitable for nearly every industry that uses card machine - Pubs, Restaurants, Retailers, Beauty, Leisure, Vets, Dentists etc
- Looking to raise funds? Stock purchase? New equipment? Business expansion or refurbishment? Or simply for cash flow?
- You need to be trading for at least 4 months
What are the benefits of Merchant Cash Advance to me?
- No Interest, APR's or hidden costs
- No impact on Credit score
- You don't need to secure it against assets or any other collateral
- Only Repay with Sales
- Cash sales are untouched