Using Merchant Cash Advances to Boost Small Business Growth

A merchant cash advance or MCA is an alternative source of funding separate from standard business loans. It is an opportunity best taken once you understand the benefits it can bring to your small business. These benefits include an easy application process and helping maintain a steady cash flow. It is perfectly tailored to help your small business grow.


Applying for a Merchant Cash Advance


Applications do not solely focus on business credit. As such, there is a high approval rate for those applying for a merchant cash advance. This is perfect for small businesses that have just started out. Instead, providers will examine business performance, such as monthly and yearly revenue, in order to determine just how much cash your business needs. Evidence of business performance will be collected from the length of time your business has been in operation and from any credit card returns. Nine months of business and about $5000 in credit card returns are the usual minimums required from small businesses looking to apply. However, you can find exceptions to that rule based on your current business needs. You do not have to put any collateral towards a MCA as well, unlike standard loans. A MCA will not affect your business credit as it is a sales transaction between you and the provider.


Maintaining Cash Flow


High business growth means more income. It also means having higher expenses, such as having to hire more employees or needing to move into a bigger office to accommodate your growing business.  A merchant cash advance can mitigate these points of concern by providing quick access to cash. You can gain the needed funds quickly thanks to little to no paperwork required when applying for a MCA. As such, funds are usually available after a week, compared to the months it can take to get funds from a commercial loan. A MCA requires monthly payments, but the amount is always gauged after examining your business revenue. For example, your monthly payment will increase for a month of high profits and decrease for a month of slow business. Payments will always align to what is best for your business as opposed to the fixed rate you have to pay each month for a standard loan.


A merchant cash advance is a perfect alternative for small businesses that have low business credit or are in need of cash quickly. Its application process is easy to follow through and your chance of approval is high. In return, you can get the money you need to help maintain steady revenue and adjust to growth.