Merchant Cash Advance Loan
Merchant Cash Advance (MCA) Loan
What is a Merchant Cash Advance Loan?
A merchant cash advance (MCA) isn’t technically a loan, but rather a cash advance based upon the credit card sales of a business. A small business can apply for an MCA and have an advance deposited into its account fairly quickly.
Merchant cash advance providers evaluate risk and weight credit criteria differently than a banker. An MCA provider looks at the daily credit card receipts to determine if the business can pay back the funds in a timely manner. Basically, a small business “sells” a portion of future credit card sales to acquire capital immediately.
When does it make sense for a business to use a merchant cash advance? An MCA is an option when a business needs access to capital quickly to take advantage of an opportunity to purchase inventory at a discount, a special marketing opportunity, or other short-term capital need. And, because credit requirements are less stringent, it could be an option for a business that does a lot of credit card transactions, but might have less-than-perfect credit.Need a Merchant Cash Advance? Click Here » How to Apply
The time it takes to get approved for a merchant cash advance could be anywhere from hours to a few days, depending on the paperwork and other details. And once the process is approved, a business could see the funds in their account within 2 days.
The application process isn’t as complicated as a traditional loan, which typically makes the merchant cash advance approval process a faster option. Here are the steps a business needs to take:
Apply for funding
Set up the credit card processing
Finalize the details
Receive the funds
Bank Funding Obstacles
All lending institutions focus mainly on a business’ quality of earnings. The main reason small businesses are denied funding from traditional avenues, like your bank, are due to insufficient collateral, debt load, and lack of personal credit.
How Does Paramount Compare
Paramount will mainly focus on your company’s ability to pay. Collateral, debt load, and lack of personal credit are not main contributing factors in getting you approved.
- ● Funds Available in as little as 24 Hrs.
- ● Personal Credit NOT a Major Factor
- ● No Fund Usage Restrictions
- ● Flexible Payment Options
- ● Funds available in weeks or months
- ● Personal Credit IS a Major Factor
- ● Use of Funds can be Limited
- ● One Payment Option
Top 3 Misconceptions of Merchant Cash Advance (MCA).
“I Don’t Have Collateral” or “I Don’t Want to Put Up Collateral”
Many do not realize that getting a merchant cash advance (MCA) through a company like Paramount Payment Systems is simple. Unlike traditional bank loans that require collateral, a Merchant Cash Advance does not. It is mainly based on a business’ cash flow. Showing that the business is making money is key, and it alleviates a lot of stress of having to tie up property or assets.
“I Will Not be Approved because of My Poor Credit” or “My Credit is Perfect, I Will Be Approved for any Loan”
Although the merchant cash advance industry does approve around 65% of applicants compared to traditional banking’s 20-30%, there are still requirements to be met. They are just different. When mainly focusing on the financial merits of a company rather than personal pitfalls of the signer, a whole new world opens up.
“I Could Use Funds but I Can’t Wait Weeks or Months for Approval”
Many apply for traditional bank business loans, only to find out months later if they have been approved and when funds will be available; generally 60-90 days. With a merchant cash advance (MCA) through a company like Paramount Payment Systems you can receive funds in a significantly shorter amount of time, even as little as 24 Hours in many instances!