If your business needs cash quickly and has a readily ascertainable history of credit card receipts, or a constant flow of cash deposits, a Merchant Cash Advance "MCA" may provide the funding you require.
A Merchant Cash Advance can provide small business owners with an upfront fixed amount of cash in as little as 24 hours. The funding amount is based upon a percentage of the businesses credit card receivables or daily cash balances using historical credit card receipts and bank statements to determine the initial advance. The business pays back the advance, plus a percentage, often referred to as a discount factor, from a portion of their credit card receivables or cash available plus a percentage which is often referred to as a discount factor. The remittances are drawn from the business customer on a daily, or weekly basis until the obligation has been met. MCA's are great options for small business owners who may not have strong credit but have lots of credit card activity, or cash deposits and need financing quickly.
One of the greatest benefits of a Merchant Cash Advance is that the funds can be used for a host of business expenses. There are typically no restrictions on how you choose to use your Merchant Cash Advance, however some of the more typical uses of an MCA include:
- Buying equipment – Could a new computer, desk, telephone, cash register or software come in handy? Money to pay for the purchase of necessary business equipment could help boost your profits. And if this cash isn’t readily available in your account, a Merchant Cash Advance can provide you with these funds.
- Paying employees – Instead of running your business like a one-man show, a few extra hands could really help. Spending borrowed money on employee’s salaries can be the answer rather than disrupting your cash flow to cover this expense.
- Purchasing inventory – One of the most common uses for a Merchant Cash Advance is buying inventory. It takes products in stock to make business profitable, so it only makes sense to invest in enough inventory to make sure you always have enough to sell to clients.
- Expanding the business – If your business is experiencing some success, you might want to start thinking about taking things to the next level. A lump sum of cash might be just what you need to get business booming.
The biggest advantage to an MCA is the speed at which providers can fund the advance. LVRG Funding is able to provide small business owners up to $1 Million in as little as 24 hours and credit is not a factor. The speed of the funding can allow a business to react quickly if there is a specific funding need. It may be an equipment purchase, increasing staff, inventory purchase or repairs needed. The underwriting process is expedited because many of the items that traditional banks and lenders review are not required for an MCA.
Repeat funding is also prevalent in the MCA world. Once a small business owner pays down half of the original advance, additional funding may be offered. So what are you waiting for? Apply today for a small business financing solution from LVRG!