If you are a small business then you have experienced a cash crunch at some time. This can be a very trying time for a small business owner. Murphy’s law definitely comes into play when your business is experiencing a cash crunch. The computer crashes, the copier breaks down or you just need enough cash to purchase a piece of equipment that will make you a considerable amount of money but you are out of the necessary funds to pay for these expenses. What is a merchant to do? merchant cash advance
A merchant should consider a temporary loan known as a merchant cash advance. A merchant cash advance is very unique in that it allows a merchant to borrow money without having to prove their income with financial statements or tax returns. The merchant just needs to provide their last three months merchant credit card statements and a few other documents to be approved. The other great benefit of a merchant cash advance is it is very quick to fund and your credit does not affect your ability to get the loan.
The loan is usually paid back in about 9 to 12 months through each credit card transaction that is made in the merchant’s store. The merchant usually keeps about 85% of each transaction while the other 15% is automatically deducted to pay back the loan. There is no fixed payment so if the merchant has a slow month in credit card sales then they would end up not paying out as much on their loan. This is a huge benefit especially if their business had a slow month of sales.