A Merchant Cash Advance is a funding product providing working capital to business owners. Merchants sell a specific amount of their business’ future credit and debit card receivables (at a discount) in exchange for cash they can use for whatever their businesses need.
Once approved, a lump sum of cash is deposited into the merchant’s business checking account. The collection process is automatically handled by the business’ credit card processor. As each day’s credit and debit card transactions are settled, a specific percentage is forwarded and applied to the remaining Merchant Cash Advance balance.
Because a set percentage of credit and debit card receipts are forwarded, your card-sales volume determines the amount of each payment. No inflexible monthly payment amounts, and no possibility of missed or late payments and their associated penalties.
Our Merchant Cash Advance is a proven, trusted way for you to get quick money for your business needs. You decide how to spend the money, whether it is for renovation, marketing/advertising, taxes or payroll, handling the costs of emergencies, or growth strategies.
There is low documentation, and no personal collateral is required. There are no application fees and no hidden charges. Because it aligns so well with the way they operate, 3 out of 4 qualified customers will return for multiple advances to help stabilize and grow their businesses.
How it Works
From start to finish, the entire process of a Merchant Cash Advance is just 4 easy steps:
1. Applying. You submit a quick application form. A Creative Loan Source customer service representative contacts you directly to complete the qualification process. Verification includes a number of simple facts about your business and its operations.
2. Transacting. Upon qualification, you will agree to allow a specific percentage of your business’ future card sales to be forwarded as they are settled. In exchange, you will receive a lump sum of working capital into your business’ checking account and you decide how to spend the money on your business.
3. Forwarding. As each day’s card sales are settled, a specific percentage is automatically forwarded by the business’ credit card processor. This percentage is fixed, so each dollar amount forwarded reflects your daily credit and debit card sales volume (see image below for payment forwarding detail).
4. Completing. Forwarding stops automatically when the total amount of card sales your business sold has been forwarded—usually in less than 12 months (depending on card sales volume).
FAQs
How do I qualify for funding?
Ideally, you will have owned and operated your business location for 12 months or more. Your business needs to have predictable card sales activity, and be able to provide from 4 to 12 months of processing statements. Adult entertainment and sexually oriented businesses are ineligible. We make sure you have no outstanding bankruptcies or large tax liens, and we do not currently help businesses that are 100% Internet-based (no physical location).
How do you decide how much I can get?
The amount of funding available to you is determined primarily by your monthly sales volume. Typically, an eligible customer qualifies for an advance that is around the same amount as its monthly credit and debit card sales. As an example, if your business processes an average of $20,000 in credit/debit transactions every month, the amount of funding available is typically about $20,000.
How soon can I get the money?
This depends on you. If you complete all the paperwork promptly, we can usually offer funding in less than 10 business days. Once you are an established customer, you can receive additional funding in as little as 72 hours.
What can I use the money for?
You decide how to spend the money—whatever is best for your business. Previous customers have used this money for renovations/remodeling, marketing and advertising plans, paying taxes, buying additional inventory, handling payroll, expansion and other business needs as they arise.
Will a poor personal credit history keep me from getting funded?
Not necessarily. Since this funding builds on the strength of your business’ card sales, your own personal credit history carries much less weight than it does in traditional financing. Your business can qualify for a Merchant Cash Advance even if you have been rejected for traditional financing options.
Do you take 100% of my credit and debit card sales?
No. Your processor forwards only the predetermined percentage of your business’ credit and debit card sales, and this percentage does not change during the life of the funding.
How often does forwarding occur?
Your processor automatically forwards a predetermined percentage of daily credit and debit card sales as they are settled. Your processor will continue to forward this percentage automatically as each credit/debit batch is settled until your business forwards the total amount of credit and debit card receivables that your business sold.
What is the interest rate?
This is not a loan, so there is no principal and no interest rate. A Merchant Cash Advance involves a sale of your business’ future credit and debit card receivables at a discount. Then, as each day’s card sales are settled, a fixed percentage is automatically forwarded by your processor until your obligation is complete.
Apply for Funding
Please note:
To be eligible for review, your business must process a minimum of $1,500 per month.
If you require any further assistance please contact
Customer Care 1-888-450-2659
Toll Free Fax 888-217-1738
10/03/10